O'Leary says Italy's price cap will have opposite effect.

Ryanair CEO Michael O’Leary on Tuesday slammed Italy’s new cap on airfares as “illegal and completely unenforceable", claiming it will lead to higher prices and reduced services.

O'Leary, 62, threatened to reduce the airline's flights on domestic routes serving Sardinia and Sicily if the Italian government insisted on retaining the price cap.

In August the cabinet of premier Giorgia Meloni approved a decree to stem rising airfares after prices soared over the summer, particularly on routes to Sardinia and Sicily.

The new law caps domestic airfares linking Sardinia and Sicily with the mainland, prohibiting airlines from raising fares beyond a level 200 per cent higher than the average price for flights serving the two islands.

Blasting it as a "stupid, idiotic decree", O'Leary said it was "based on rubbish data" and that he was convinced the measure would be "rejected by Brussels".

He said that Ryanair has already reduced flights to Sardinia by 10 per cent and pledged to do the same this winter for Sicily.

Italian industry minister Adolfo Urso hit back at O'Leary, saying: "Italy is a sovereign country, it does not allow itself to be blackmailed by anyone."

O'Leary was speaking in Milan during the presentation of Ryanair's new winter routes, from Malpensa and Orio airports, whose destinations he stressed would be international and not domestic.