All four crew members are missing, the Ministry of Defence said in a statement, although some reports suggested the pilots may have managed to eject.
"Rescue helicopters and reconnaissance fighters are in the air and a team of experts have been sent to the accident site," the statement added.
Italian media reported that the two Tornado aircraft collided near Ascoli Piceno in the Marche region.
Witnesses said the two planes had touched in flight before crashing. Military sources were quoted as saying the crews may have been able to eject before impact.
Falling debris started a number of fires in the area, although no homes appear to have damaged, according to reports.