The dramatic escalation in the country’s efforts to contain the new coronavirus will close gyms, pools, museums and ski resorts.
Weddings and funerals are also suspended under the new measures.
Italy is Europe’s worst-hit country and reported a steep rise in virus infections on Saturday.
The new measures, which also apply to financial centre Milan and tourist hotspot Venice will last until 3 April.
The death toll in Italy has passed 230, with officials reporting more than 50 deaths in 24 hours. The number of confirmed cases jumped by more than 1,200 to 5,883 on Saturday.
“We want to guarantee the health of our citizens. We understand that these measures will impose sacrifices, sometimes small and sometimes very big,” Prime Minister Giuseppe Conte said early on Sunday.
“But this is a time where we must take responsibility for ourselves.”
People are unable to enter or leave the whole northern region of Lombardy, home to 10 million people, except for emergency access. Milan is the main city in the region.
The same measures apply to 14 provinces including Venice, Parma and Modena, affecting a total of around 16 million people.
Prime Minister Conte said the provinces affected were Modena, Parma, Piacenza, Reggio Emilia, Rimini, Pesaro and Urbino, Alessandria, Asti, Novara, Verbano Cusio Ossola, Vercelli, Padua, Treviso and Venice.
Until now only around 50,000 people in northern Italy had been affected by quarantine measures.
What are the measures?
Weddings and funerals have been suspended, as well as religious and cultural events.
Cinemas, night clubs, gyms, swimming pools, museums and ski resorts have been closed.
Restaurants and cafes can open between 06:00 and 18:00 but customers must sit at least a metre apart.
People have been told to stay home as much as possible, and those who break the quarantine could face three months in jail.
Sports competitions will close to the public, and the president of Italy’s football players’ union has called for all matches to be postponed.
The World Health Organization has advised Italy to strongly focus on virus containment measures as infections spread in the country.
The plans echo China’s forced quarantine of millions of people which the WHO has praised for halting the spread of the virus.
Leading Italian politician Nicola Zingaretti said on Saturday he had tested positive for the virus.
“I am fine but I will have to stay home for the next few days,” the leader of Italy’s centre-left Democratic Party (PD) said in a Facebook post.
The country has said it will start recruiting retired doctors in an effort to combat the escalating outbreak.
‘Highest priority’
Elsewhere, Iran has confirmed almost 6,000 infections and 145 deaths, and the number of cases worldwide has passed 100,000, officials say.
A second MP was reportedly among those to have died in Iran, where health officials fear the number of cases may actually be much higher.
There have so far been nearly 3,500 coronavirus deaths recorded worldwide. The majority have been in China, where the virus originated in December.
The head of the World Health Organization (WHO), Tedros Adhanom Ghebreyesus, has called the spread of the virus “deeply concerning” and urged all countries to make containment “their highest priority”.