If you plan to rent a car and drive in Italy on your vacation, these driving tips may be helpful.
While a GPS will come in handy for navigation, don't rely on it exclusively. I've talked to several people who ended up in the wrong place because they followed GPS directions. In Italy it is common to find two (or more) towns with the same name in different regions so be sure to look at your map to see if you are heading the right way.
In addition, a navigator may direct you into a ZTL (see above) or to turn the wrong direction on a one-way street or even into an alley that ends in stairs (I've had all these things happen myself). Also in my experience, speed limits shown on the GPS are not always accurate either so be sure to watch speed limit signs for yourself.
When looking for a car rental, don't be fooled by a company whose prices are much lower than others. It's likely that they will add on additional costs either when you pick up the car or when you return it. I recommend going through a company such as Auto Europe that shows all costs up front, provides 24-hour assistnace in English, and includes insurance.
If you need a car for at least three weeks, consider a car buy-back lease. You'll get a brand new car with excellent insurance and no additional costs except the pick-up/drop-off charge for Italy (which you can avoid by picking up in France).
This is what I do myself.
International Driving Permit
Contrary to what you might hear, if your driver's license is from the US (or other countries outside the EU) you should carry an International Driving Permit along with your local license. You'll need to show it if you get stopped by the police for any reason including if you're in an accident. It's not a license, requires no test, and is basically a translation of your driver's license. See how to get an International Driving Permit.
Zona Traffico Limitato or ZTL
Do not drive in an area with a sign that says Zona Traffico Limitato (ZTL) or Area Pedonale, limited traffic or pedestrian zones. Most cities have these zones and even in small towns you may find them in the historic center, the centro storico. A special permit is needed to drive in a limited traffic zone (which your hotel can usually provide if it's within one). There is usually a camera that takes a photo of your license plate as you enter and you may get a fine in the mail even if you don't get stopped right away. Look for a parking lot outside the center - you'll often find one within walking distance or with a shuttle to take you to the center.
Italy has two main devices for catching speeders, Autovelox and Sistema Tutor. Always be on the lookout for autovelox which can be found on the autostrada, regular highways, and even in some towns. The autovelox looks like a big box with a sign but inside is a camera that takes a photo of your license plate. You can receive a ticket as much as a year later. (note that if you have a rental car, they have your credit card information). You should also see a warning sigh in advance that says Polizia Stradale, controllo electronico della velocita'.
Sistema Tutor is a new system used on some stretches of the autostrada. An overhead camera takes a photo of your license plate as you pass under it. When you pass under the next camera, your speed is averaged between the two points and the average should not exceed 130 kilometers per hour (or 110 if raining). As above, you may receive a ticket in the mail or through your rental car company.
Driving on the Autostrada or Toll Road
The autostrada is Italy's system of toll roads. Autostrada highways are designated with an A in front of a number (such as A1, the major autostrada that connects Milan and Rome) and signs pointing toward them are green.
The maximum speed limit is 130 kilometers per hour but on some parts of the autostrada the maximum speed is 110, and may be as low as 60 on some curvy stretches, so watch for posted speed limit signs. When you exit the autostrada, you will pay a toll (take a ticket as you enter). US credit cards do not always work at the toll booth so be sure you have cash with you. See more Tips for Driving on the Autostrada, including how to find the toll cost.
Driving on Sundays
Sunday is a good day for long distance driving on the autostrada, because trucks are prohibited on Sundays. Be aware that in summer, coast roads become very congested, especially on Sundays. Roads around the northern lakes are often congested on weekends, too.