“The aim is clear: to keep the contagion curve under control, because that is the only way can we manage the pandemic without being overwhelmed by it,” Conte told a press conference.
It was imperative Italy act now to avoid a second full lockdown, which “the country can no longer afford”, he said.
Cinemas, theatres, gyms and swimming pools must all close under the new rules, which come into force on Monday and run until at least November 24th.
Restaurants and bars will stop serving at 6pm, Conte's office said.
Schools and nurseries will remain open, although up to 75 percent of classes for high-schools and universities will move online. People have been urged to avoid using public transport or moving beyond their own communities.
“This is going to destroy us,” Augusto D'Alfonsi, who owns the Torricella family-run fish restaurant in Rome, told AFP. “We've already lost 50 percent of our customers this year. Without government aid, we're done for.”
Italy, which was the first European country to be hit hard by the pandemic and impose a nationwide lockdown, on Saturday registered nearly 20,000 new cases over 24 hours.
Several regions have imposed overnight curfews in a bid to slow-rising Covid-19 infection numbers. Piedmont in the north and Sicily in the south will follow this week.
But regional leaders had warned that closing businesses would exacerbate social tensions as the country struggles to emerge from its worst post-war recession, sparked by the two-month shutdown earlier this year.
Giuseppe Spadafora, deputy president of business lobby Unimpresa, said the “anger could explode in the coming days and weeks, becoming difficult to control”.
Conte, however, has been under intense pressure from scientists to do more to curb contagion.
“It is a complex moment, there's a lot of tiredness in the country,” he acknowledged Sunday.
“The pandemic is severely challenging us, it provokes anger, frustration. It's also create new inequalities, on top of the existing ones,” he said.
The new measures were introduced just hours after dozens of far-right protesters in Rome clashed with riot police during a demonstration against the region's curfew, setting off fireworks, burning bins and throwing projectiles.
Some 200 masked militants belonging to the neo-fascist group Forza Nuova lead the skirmish in a second night of street protests, after hundreds of demonstrators clashed with officers in Naples further south over the curfew there.
Conte said he too “would feel angry over government measures” as an ordinary citizen, though “I would wait to see the economic support, which will be substantial”.
He also warned against “giving room to those who specialise in protests and social disorder”, after the far-right demonstration in Rome and reports the Naples protest was orchestrated by organised crime.
The World Health Organization's Italian government adviser Walter Ricciardi told the Messaggero daily the country was “paying the consequences” of regional governments failing to prepare for a second wave.
“We only have a few weeks to intervene. We need local, even regional lockdowns. The curfew does not work”.
Italy has now registered over 500,000 cases and more than 37,000 deaths, according to health ministry figures.
Over 100 scientists urged the government to act this week after physicist Giorgio Parisi said that without new measures there would be 500 covid deaths a day in Italy by November, at the speed the virus is spreading.
“In March we were about to be hit by a lorry going 130 kilometres an hour. Today it's travelling towards us at 60 kilometres an hour,” he told the Repubblica newspaper on Saturday.
“We have time to dodge it but if we don't, even if it's travelling more slowly, it will kill us all the same”.