Italy's President Sergio Mattarella was sworn in Thursday for a second term, after parliament begged him to stay on to stave off a looming political crisis.

"This is a fresh, unexpected call for a commitment which I cannot -- and will not -- back away from," the 80-year-old said, noting the challenges Italy faced in the wake of the coronavirus pandemic.

His inauguration in parliament was marked by wild bursts of applause from lawmakers, whose inability to agree on a replacement had threatened to bring down Prime Minister Mario Draghi's government.

Mattarella said he stepped up to end the "profound political uncertainty and tensions" which could have "jeopardised... the prospects for relaunching" debt-laden Italy, the eurozone's third largest economy.

These have been "troubled times for everyone, including me," he told the lower Chamber of Deputies, which was decked out in red drapes and 21 vast Italian flags.

The cannons on the Gianicolo hill overlooking Rome fired a 21-gun salute and the bronze bell at the lower house rang out as Mattarella took the oath.

In his speech, Mattarella sounded a warning note over geopolitical tensions, urging a "more just, more modern Italy" to be "intensely linked to the friendly peoples that surround us".

"We cannot accept that... the wind of confrontation is once again rising in a continent that has known the tragedies of the First and Second World Wars," he said in a nod to the West's fears that Russia might invade Ukraine.

He also called those present to increase efforts to rebuild Italy after the devastation of Covid-19, which hit the country hard and has killed over 147,000 people.

Mattarella's re-election on Saturday was hailed as having temporarily averted a political disaster but it also laid bare deep fractures within the ruling national unity government.

Draghi, brought in by Mattarella last year, has been racing to ensure Italy qualifies for funds from the EU's post-pandemic recovery scheme, which amounts to almost 200 billion euros ($225 billion) for Rome.

The bitter deadlock over the presidential candidate risked derailing those reforms, and fears remain that one or another of the parties in government could pull out or implode.

The presidential post in Italy is largely a ceremonial job, but it plays a key role during a political crisis, and experts said Mattarella looked set to have his work cut out.

Matteo Salvini, head of the right-wing League, whose pick for president flopped last week, voted against a cabinet decree on Wednesday but said he was not about to quit the government.

He was not present at Mattarella's inauguration after posting on Facebook that he had caught Covid-19.