Rome's La Sapienza University, the most crowded campus in Europe with more than 170,000 students, will be split into several independent institutions.
The move comes after a tug-of-war between the government and La Sapienza, which resisted what it saw as the "dismembering" of Italy's most important university.
The plan approved by La Sapienza academic council is a compromise. There will be four or five autonomous institutes, each dedicated to one or more disciplines, included in a federation under the La Sapienza name.
Each will have a rector, academic council and administrative board, but will be linked to a central authority with some powers, including distributing money.
La Sapienza's academic council decided to modify its statutes to allow for a radical "decentralisation and decongestion" four years after a ministry decree that sets at 40,000 the maximum number of students for any single university.
Special funds of more than Pounds 300 million over several years have been earmarked to help La Sapienza decentralise. The city of Rome has also indicated it will provide buildings and areas to be used for the new institutes.
Talks are now under way between faculty directors and the ministry, which still has to approve the decentralisation plan. It is probable that medicine, law and economics will be in one institution, and sciences and engineering in another.
Architecture and sociology will be in a third, and the humanities grouped together in a fourth or fifth unit.
Giuseppe Guarini, the deputy rector who is in charge of the plan, said the process should take about ten years.