Matteo Messina Denaro, 53, who has been on the run since 1993, used a farm in Mazara del Vallo to communicate with his henchmen via the aged-old method of "pizzini", paper containing messages often written in cipher, police said.
Among those arrested was former boss Vito Gondola, 77, whose job it was to call the clan members to alert them to each new message, which was placed under a rock in a field at the farm and often destroyed on the spot after reading.
"I've put the ricotta cheese aside for you, will you come by later?" he would say on the telephone - a phrase investigators said had nothing to do with dairy products.
"The sheep need shearing... the shears need sharpening" and "the hay is ready", were among other code phrases used to alert the gang to a new message hidden in the dirt.
The police investigation, which followed the passing of messages between 2011 and 2014, used hidden cameras and microphones around the farm near Trapani in western Sicily to follow the movements of the clan - and discover Denaro's fading glory.
Gondola is caught in one conversation telling another mobster that Denaro - once a trigger man who reportedly boasted he could "fill a cemetery" with his victims - was losing control over the latest generation of criminals, who "disappear without saying anything".
Three of those arrested were over 70 years old.
'State win, Mafia loses'
The only known photos of Denaro date back to the early 1990s. He is believed to be the successor of the godfathers Toto Riina and Bernardo Provenzano, who are both serving life sentences, but less is known about him.
The 11 suspects arrested "were the men who were closest to Denaro right now," said police official Renato Cortese, adding that it was "too early to say" whether the sting would help investigators close in on the fugitive.
Prime Minister Matteo Renzi thanked the investigators in a message on his Facebook page, saying "onwards all, to finally capture the super-fugitive boss," insisting "Italy is united against organised crime" despite a recent slew of corruption scandals in the country.
"The state wins, the Mafia loses," Interior Minister Angelino Alfano said on Twitter.
Gondola, who despite his age rose every morning at 4 am to tend to his flock, is believed to have once been a right-hand man to Riina. In the 1970s he belonged to a gang used by the Mafia to carry out kidnappings, according to Italian media reports.
The Sicilian Mafia, known as "Cosa Nostra" or "Our Thing", was the country's most powerful organised crime syndicate in the 1980s and 1990s, but has seen its power diminish following years of investigations and mass arrests.
It also faces fierce underworld competition from the increasingly powerful Naples-based Camorra and Calabria's 'Ndrangheta.