On Friday, Italy reported 17,992 new coronavirus cases and 674 deaths, which increased the overall infection tally and the death toll to 1,921,778 and 67,894, respectively, Xinhua news agency reported.
Friday's figures were down from the previous day's 18,236 new cases and 683 deaths on Thursday, according to the Ministry of Healthy.
"The situation remains difficult, in Italy and in Europe," Conte said in his speech on Friday.
"The virus continues to circulate everywhere."
Italians will have to spend much of the Christmas and New Year holiday in a general "red zone", which has been imposed in a bid to stem the spread of the coronavirus, Prime Minister Giuseppe Conte announced in a televised address to the nation.
He added that the whole of Italy will become a designated "red" or high-risk zone from December 24 to January 6.
The Italian government had, in early November, introduced a three-tier system and split the country into three zones -- red for the highest risk, orange for medium risk, and yellow for low risk -- according to the level of virus transmission and the situation of the public health system.
The "red zones" are subjected to restrictions equal to a partial lockdown.
People living in red zones can't leave the house except for provable work or health-related reasons and are banned from travelling in or out of their regions and municipalities.
Bars, restaurants and all retailers except groceries, pharmacies, and news-stands must shut down.
However, Conte added that during the festivities, people will be allowed to invite a maximum of two adult guests to their homes, plus any number of children up to 14 years of age.
The Prime Minister also explained that there will be four exceptions to the red zone -- on December 28, 29, and 30 and January 4 -- during which shops will be able to open and people will be free to leave their houses.
Throughout the holiday period, all bars and restaurants in Italy must remain closed.
Conte also said that the Italian government has set aside 645 million euros ($790 million) in what he called an "immediate relief package" for bars, restaurants and retailers who will incur economic losses due to the holiday lockdown.