Rome's traditional New Year's Eve celebrations are centered in Piazza del Popolo. Huge crowds celebrate with rock and classical music and dancing and of course, fireworks. The celebrations last well into the night. On New Year's day (while the adults are sleeping), children will be entertained in the square by performers and acrobats.
Next to the church of Santa Maria del Popolo, you can still see the exhibit of traditional nativity scenes (through January 8) from 100 regions of Italy and other countries of the world.
Another good place to celebrate is near the Colosseum on Via dei Fori Imperiali where there's live music usually starting around 10PM and midnight fireworks. There is usually a classical music concert outdoors on the square in front of the Quirinale, off Via Nazionale, around 11:00 also followed by fireworks at midnight.
For live music, check these Rome Music Venues.
Rimini, on the Adriatic coast, is one of Italy's most popular nightlife spots and a top place to celebrate. Besides parties in numerous nightclubs and bars, Rimini holds a huge New Year's Eve festival in Piazzale Fellini starting at 9:00. There's music, dancing, and entertainment and a spectacular display of fireworks over the sea. The Rimini New Year's Eve festival is usually televised in Italy.
Naples and Capri
Naples is known as having one of the best New Year's Eve fireworks displays. They also have huge outdoor music events, especially in Piazza del Plebiscito in the city center where there are usually classical, rock and traditional music concerts. In some parts of Naples, people still throw their old things out of their windows.
A tradition called Lo Sciuscio originated in Naples. Although it has pretty much died out there, it still exists in some smaller towns nearby. Groups of amateur musicians (now mainly children) go from house to house playing and singing on New Year's Eve. A small gift of money or sweets is given to them to bring good luck in the new year and turning them away may bring bad luck.
On the island of Capri near Naples, local folkloric groups usually perform in the Piazzetta in Capri and Piazza Diaz in Anacapri on January 1.
Bologna traditionally celebrates New Year's Eve with the Fiera del Bue Grasso (fat ox fair). The ox is decorated from horns to tail with flowers and ribbons. The church bells are rung, spectators light candles and of course, fireworks are set off. At the end, a special lottery is held with the winner getting to keep the ox. The procession ends just before midnight in Piazza San Petronio. In Piazza Maggiore there's live music, performances, and a street market. At midnight an effigy of an old man is thrown into a bonfire.
Many restaurants in Venice go all out with huge feasts on New Year's Eve, starting around 9:00 and lasting until midnight. Although expensive, they tend to be very good with many courses and lots of wine. Be sure to make a reservation ahead of time. Many restaurants will be closed on New Year's day, however. You can usually expect pizza places, hotel restaurants, and Chinese restaurants to be open.
St Mark's Square has a huge celebration with music, a giant fireworks display, bellini brindisi (toast), and a huge group kiss at midnight. The group kiss is also held in Piazza Ferretto in Mestre.
New Year's Concert, Concerto di Capodanno, at La Fenice Theater is performed on December 30, December 31, and January 1. Following the December 31 performance (4PM), there's a huge New Year's party starting at 8PM with welcome drinks, dinner, and midnight toast.
On New Year's Day, many bathers take a chilling dip in the waters of Venice's Lido Beach. That's one way to get over your hangover!
Many restaurants in Florence will have extravagant meals, too. Be sure to reserve early. Fireworks will be set off at midnight and a good place to see them would be on one of the bridges on the Arno. Florence usually holds public concerts in Piazza della Signoria and Piazza della Repubblica.
Pisa has music and a good fireworks show over the Arno River in the center of town. Pisa's Verdi Theater usually has both a New Year's Eve and New Year's Day concert.
The city of Turin, in northern Italy's Piedmont region, holds public festivities in Piazza San Carlo which you may recognize from the 2006 Winter Olympics. Live music, DJ music, a parade, and fireworks highlight the evening's events.