Italian Premier Giuseppe Conte on Sunday signed a new decree that goes into effect Monday, closing down all non-essential production across the country.
The factories involved have three days to prepare and must be closed by March 25.
Supermarkets, pharmacies, food stores, banks, post offices and transport services are keeping going.
While most shops had already been closed down by the lockdown, many factories had continued to operate.
The number of open public offices will be drastically reduced, with the exception of services related to health, defence, social security and distance education.
The decree includes a list of 80 sectors that will remain open, including professional services by attorneys, accountants, engineers and architects; call centres; newsstands, the press and media; tobacconists, with the exception of the national lottery, which has been suspended; live-in domestic help and building doorkeepers; as well as all services related to the production and supply of food, medicine, and transport of essential goods.
People have been barred from moving from one town to another.
Premier Giuseppe Conte told La Stampa Monday that "everyone's efforts are needed (in the coronavirus crisis) and the survival of the social and economic fabric of our country is at stake".
He said the government's decision to close non-essential industrial activities and step up a nationwide lockdown had been "well thought out".
The next few weeks will be "very challenging and crucial", he said.
"Today we are distributing four million face masks," Conte added, saying he was in touch with the centre-right opposition on all the government's moves.
Too many people are still out and about despite an intensification of the regional and national governments' lockdown rules, Lombardy Governor Attilio Fontana said Monday.
People have been banned from leaving their homes and can only walk the dog or jog around the block, as well as travelling for health, food and other essential purposes.
"I hope the more rigorous norms can be applied because there are still too many people out and about and too many reasons and possibilities of contagion," Fontana told Italian TV.
Labour unions have threatened a general strike if too many factories remain open.
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