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Berlusconi made the apology during a visit to the Mediterranean city of Benghazi for a meeting with Libyan leader Moamer Kadhafi to seal a cooperation accord with the oil-rich north African nation.
"It is my duty, as a head of government, to express to you in the name of the Italian people our regret and apologies for the deep wounds that we have caused you," said Berlusconi, whose comments were translated into Arabic.
He and Kadhafi then signed a "friendship and cooperation agreement" aimed at recompensing Libya for damage incurred during the colonial era.
"The accord will provide for 200 million dollars a year over the next 25 years through investments in infrastructure projects in Libya," Berlusconi said.
"This agreement should put an end to 40 years of discord.
It is a concrete and moral acknowledgement of the damage inflicted on Libya by Italy during