In November 2018 the watchdog ruled that Facebook had not informed users properly about the collection and use, for commercial reasons, of the data they release.
It fined the U.S. company 5 million euros ($5.5 million) and asked it to publish an amending statement on the homepage of its website for Italy, on the Facebook app and on the personal page of each registered Italian user.
On Friday the regulator said in a statement that Facebook had not done so and the company could face another fine of up to 5 million euros.
A spokesperson for Facebook said the group was reviewing the decision.
The company made changes last year, including to its Terms of Service, to further clarify how it makes money, the spokesperson said.
"These changes were part of the group's ongoing commitment to give people more transparency and control over their information."
(Reporting by Sabina Suzzi and Stephen Jewkes; Editing by Susan Fenton)