"Fire at Sea" by award-winning director Gianfranco Rosi, set on the Mediterranean island of Lampedusa, emerged as an early favourite among 18 contenders for the festival's Golden Bear top prize, to be awarded by jury president Meryl Streep on February 20.
The film provides an unflinching look at the thousands of desperate people who arrive on the island each year trying to enter the European Union, and the thousands more who have died trying.
But Rosi, who spent several months on Lampedusa making the documentary, also offers a tender portrait of the rhythms of daily life in Lampedusa's ancient fishing villages and efforts of local people to help those in need.
"It bears witness to a tragedy that is happening right before our eyes," Rosi told reporters following a enthusiastically received press preview.
"I think we are all responsible for that tragedy and perhaps after the Holocaust, it is the greatest tragedy we have ever seen in Europe."
The picture is told through the eyes of a 12-year-old local boy, Samuele Pucillo, and a doctor, Pietro Bartolo, who has been tending to the often dehydrated, malnourished and traumatised new arrivals for a quarter-century.
Rosi, who clinched the Venice film festival's 2013 Golden Lion for his film "Sacro GRA", also accompanied coastguard rescue missions answering the terrified SOS calls of people on overcrowded boats, most of them arriving from Libya.
They are taken to a reception centre for medical examinations and processing while awaiting transfer to other sites in Italy.
Rosi captures the migrants' overwhelming relief to be on dry land, the shock that gives way to mourning for their dead, and the crushing boredom they break up with rough-and-tumble football games.
In one powerful scene, a Nigerian man recounts the perilous journey to Italy in a call-and-response chant with other African migrants, describing what was for many a deadly trek through the scorching Sahara, and the suffering endured at the hands of Islamic State jihadists and prison guards in Libya.
Bartolo, the doctor, said that he hoped the film would open more Europeans' eyes to the plight visible in Lampedusa every day, as the political debate grows more entrenched.
"I've seen so many terrible things, so many dead children, so many dead women, so many raped women. These things leave you with a great big empty hole in your stomach," he said.
"These are nightmares that haunt me very often."
Tim Robey of London's Daily Telegraph called the film "pertinent, humane" and "shattering" on Twitter, while Kate Muir of the Times pronounced it "brilliant".
Festival director Dieter Kosslick said ahead of the festival that a single theme ran through much of the selection this year: "the right to happiness -- the right to a home, to love, to self-determination, to life and to survival".
Hollywood star George Clooney and his wife Amal, a Lebanese-born human rights lawyer, used the occasion of the festival to offer their backing and assistance to Chancellor Angela Merkel in a meeting at her office Friday, after Germany let in 1.1 million asylum seekers last year.
The 11-day cinema showcase is also featuring around a dozen films shining a light on the crisis in various ways.
German documentary "Havarie" traces the fate of a small rickety refugee boat in the Mediterranean, spotted by a tourist who made a mobile phone video from a cruise ship.
Danish film "Those Who Jump" hands the camera to a Malian migrant trapped in the high-security border facility between the EU and Africa as he and hundreds of other would-be asylum seekers plot their next move.
And Syrian-Iraqi production "Life of the Border" allowed eight children in a refugee camp in the Kurdish Syrian town of Kobane to film their own stories.
The festival runs until February 21.
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