In 2012, the International Court of Justice in the Hague, the UN's highest judicial body, ruled that private individuals could not take foreign states to court, including for war crimes and crimes against humanity.
"The claims against Germany filed in the courts of other countries are utterly inadmissible," said German foreign ministry spokeswoman Sawsan Chebli on Friday.
"State immunity results from the International Court's decision. That's the rule."
The Italian court found Wednesday that the UN court's decision did not overrule Italian law.
Carlo Smuraglia, head of Italy's National Partisans' Association (ANPI) – a group founded by members of the Italian resistance – welcomed the decision for "reopening the compensation debate" and "reestablishing the full right of Italian courts to rule on such questions," in a statement Friday.
But he said that he was "under no great illusion" that Germany would abide by any future compensation claims if they were made in Italian courts.
Germany has faced a growing number of cases in foreign courts from the families of the victims of civilian massacres carried out by Nazi troops in Italy and Italians used as forced labourers in Germany between 1943 and 1945.