The huge sweep of businesses, property and bank accounts "represents, in total value, one of the biggest seizures ever made", the anti-mafia department (DIA) said.
Authorities said the syndicate cultivated ties with the Italian anti-mafia movement in an effort to hide its activities from police.
"They struck upon the idea of developing ties with anti-racketeering groups in an attempt to make themselves look innocent while being targeted by criminal probes," Colonel Riccardo Sciuto of the DIA told a press conference.
The operation in Palermo was aimed at "known entrepreneurs from the Palermo area who belong to the Marineo mafia family, linked to the Corleone clan," the DIA said.
In total 33 companies - mostly in the cement business - 700 houses, villas and buildings, as well as 40 bank accounts and 40 vehicles were seized.
The haul belonged to Carmelo Virga, 66, his brothers Vincenzo, 78, and 71-year-old Francesco, and their sisters Anna, 76, and Rosa, 68. While all came from modest backgrounds working in agriculture or as homemakers, they became very rich.
Authorities said bid rigging was one of their key enterprises.
"Complex investigations have uncovered how the Virgas have benefitted from the backing of the Cosa Nostra in the bidding for these works and public tenders in the construction sector," the DIA said.
The family "succeeded over time in developing and imposing their group of companies, by using the method known as 'Siino', which consists of organizing cartels of entrepreneurs with a view to the 'directed' bidding for public tenders."
'Pizzo' mafia tax
In recent years the son of Carmelo Virga, Gaetano, became a potent symbol for anti-mafia groups in the struggle against the Sicilian mafia's extortion of companies.
As part of an effort to obstruct official probes into mafia properties, he developed ties with the groups, police said.
Gaetano Virga has told investigators that one of those mafia dons, Stefano Polizzi, came to the construction site where he worked in Marineo in 2010 to demand payment of the mafia tax known as "pizzo", telling him: "Remember that you have children."
His evidence even led to the arrest of five mafia chiefs in the region.
Virga told investigators that the mafia chief went from his office to that of one of his uncles. But there was an altercation and Polizzi left, with the uncles claiming they had not paid a cent.
Assets seized from the mafia in Italy include farm ground, luxury cars and bank accounts, trucks and chains of hotels.
After years of fighting the Cosa Nostra in Sicily, the Camorra in Naples and the 'Ndrangheta in Calabria, the Italian state now controls almost 3,000 companies and 12,000 property assets seized from the mafia.
The national agency that manages seized mafia assets also controls more than €2 billion in bank deposits and other assets.
Michelangelo Patane, a prosecutor in Sicily, noted: "In Italy it is more difficult to manage the property seized from the mafia than it is to confiscate it."