The award was for his film ``Cosi Ridevano'' (That's how they laughed), the touching but ironic story of two young Sicilians who resettle in the northern Italian city of Turin during the 1950s.

Amelio, 53, previously won fame with ``Lamerica'' (1994) and ``Stolen Children'' (1992). He said his latest movie was designed to help Italians understand better their own recent history.

The runner-up winning the Silver Lion was Emir Kusturica of Bosnia for his comedy about a gypsy wedding, ``Black Cat, White Cat''. Like its predecessor ``Time Of The Gypsies'', Kusturica's Franco-German-Yugoslav co-production uses many people as natural actors.

Twenty films were entered for competition at the festival, which ranks just after Cannes and Berlin in importance.

The festival ended withthe Venice jury chaired by Ettore Scola awarding its best-actress prize to French star Catherine Deneuve for her role as an alcoholic in ``Place Vendome'' directed by Nicole Garcia.

Sean Penn of the United States received the best actor award for his part as a nervy Hollywood figure in ``Hurlyburly'' directed by Anthony Drazan.