In their first game under new coach Roberto Donadoni the Italian reserves saw the country's 25-game unbeaten run come to an end via first half goals for Eduardo da Silva and Luka Modric as Slaven Bilic made an impressive start as Croatia coach.
There were better results for some of Europe's other major teams on a busy night of Euro 2008 warm-up friendlies with Germany, Netherlands and England all claiming big wins.
Germany, under new coach Joachim Loew, beat Sweden 3-0, England, also under new management in the shape of Steve McClaren, swept aside ailing European champions Greece 4-0 while the Dutch were impressive 4-0 winners in Ireland.
World Cup runners-up France snatched a late 2-1 win in Bosnia, Serbia, playing for the first time as a solo entity after Montenegro's independence, had an impressive 3-1 win in the Czech Republic to give coach Javier Clemente a great start while Norway stretched their unbeaten run against Brazil to four after a 1-1 draw in Oslo.
Italy's homecoming turned out to be a disappointing one in Livorno as Donadoni's stand-ins were not able to rise to the challenge set by Croatia.
Brazilian born Da Silva put the visitors ahead with a 28th minute header and Modric tucked in a rebound for the second.
"I can't complain about what the lads produced given the stage of the season we are at," said Donadoni.
In a remarkable parallel to the World Cup, Germany raced into a two-goal lead against Sweden with goals by Bernd Schneider and Miroslav Klose in the first eight minutes.
FLYING START
In the second round of the World Cup Germany beat Sweden 2-0 with two goals by Lukas Podolski in the first 12 minutes but this time Klose added the third to give Juergen Klinsmann's former assistant Loew a flying start.
England began the long and painful recovery from the World Cup with an impressive demolition of Greece with all four goals coming in the first half.
New captain John Terry, Frank Lampard and Peter Crouch, twice, added the polish to an enterprising half.
Greece, who failed to qualify for the World Cup, were awful in the opening period but fought back well to have the better of the goalless second half.
The Netherlands produced a terrific performance in Dublin against an injury-ravaged Ireland with the highlight being a superb two-goal performance from debutant Ajax Amsterdam striker Klaas Jan Huntelaar, who also set up Arjen Robben for another before Robin van Persie completed the rout.
Two Dutch coaches taking on new charges had mixed fortunes as Guus Hiddink's Russia beat Latvia 1-0 but Leo Beenhakker's Poland lost 2-0 in Denmark.
LATE WINNER
World Cup runners-up France had debutant midfielder Julien Faubert to thank for their win in Sarajevo as he slotted an injury-time winner.
Bosnia opened the scoring through captain Sergej Barbarez from a 16th minute free kick but defender William Gallas, embroiled in a contract dispute at Chelsea, levelled just before the break.
Norway remain the only team in the world to possess an unbeaten record against Brazil after another draw with an experimental visiting side.
The hosts opened the scoring in the 51st minute when Morten Gamst Pedersen's free kick from 25 metres eluded all-comers.
Brazil, playing for the first time since their defeat by France in the World Cup quarter-finals and in their first outing under new coach Dunga, levelled through Daniel Carvalho.
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