Replacements used: Luca Conti (L'Aquila Rugby) for Moriconi (16-17 mins, blood sub; 69), Giovanni Benvenuti (Marchiol Mogliano) for Campagnaro (25), Gianmarco Vian (M-Three San Donà) for Zdrilich (55), Cherif Traore (Rugby Viadana) for Scarsini (66), Rudy Biancotti (Valtellina Rugby Sondalo) for Biancotti (72), Filippo Buscema (UR Capitolina) for Bettin (79).
Replacements used: David Panther (Corinthians/Connacht) for Daly (12 mins), Brian Scott (UCC/Munster) for Furniss (20), Jerry Sexton (St. Mary's College/Leinster) for McCarthy (55), Bryan Byrne (UCD/Leinster) for Andrew (58), Eogháin Quinn (Lansdowne/Leinster) for Sweetnam (72), Peadar Timmins (UCD/Leinster) for Murphy (75), David Shanahan (Clontarf/Leinster) for McGrath (79).
The Italy Under-20s came into this game having lost their previous 14 matches at this age-grade, and Ireland were gunning for their 20th straight victory over Italy at Under-20 or Under-21 level.
But Mike Ruddock's youngsters endured a nightmare start, leaking tries to Vittorio Marazzi and Michele Campagnaro inside the opening eight minutes and talismanic centre Daly went off with an injured left arm.
Edoardo Padovani boosted Italy's lead to 15-0 before the visitors got off the mark, Daly's replacement David Panter darting over for a converted try and Scannell kicked Ireland back to within 10 points at half-time - 20-10.
Four minutes into the second half, Padovani's cross-field kick was gathered by winger David Michael Odiete for the Italians' third try and the momentum had swung again.
Ireland grew in stature as the match went on, an excellent lineout maul giving replacement lock Jerry Sexton a try. Scannell missed the conversion and a subsequent penalty, but the Dolphin clubman landed another three-pointer to make it 25-18 with 13 minutes left.
It was all Ireland in the closing stages, half-backs Luke McGrath and Steve Crosbie providing the direction as the green-shirted pack took the game to a tiring Italian pack that had scrummaged well during the opening hour.
Ireland looked the fresher of the two teams and Crosbie's perfectly placed kick out to the left was acrobatically gathered by Rory Scholes for a 74th minute try.
Scannell stepped up to land the levelling conversion from wide out on the left. Ireland had enough possession to force the winning score late on, but it did not come as the sides played out an breathless draw.
Italy made full use of the early territory in chilly Avezzano, a cross-field kick from out-half Padovani taking a fortunate bounce and Ireland had to scramble back to avoid leaking a try.
That score came just moments later, the Italians mauling forward effectively from a close-in lineout and from the ensuing ruck Marazzi piled over with the grounding confirmed by TMO Philippe Bonhoure.
Padovani added the conversion and a poor kick from Scannell, pressurised by the well-organised Italian defence, saw the hosts build for their second try.
Again, their strongly-built forwards made good yardage through a maul and lively centre Campagnaro was released for a superb diagonal run to the left corner.
The try went unconverted but sluggish Ireland suffered a further setback when chief goal-kicker Daly, their top scorer in the Championship, injured his left arm at a ruck and had to be replaced.
Padovani landed his second successful kick from the left, following a scrum penalty, however Ireland came more into this final round encounter as the first half wore on.
Encouraging carries from John Donnan and Ryan Murphy got them into scoring range. Although Sean McCarthy lacked support on an initial surge, Josh van der Flier's strong burst from deep got the visitors on the front foot once more.
The breakthrough came in the 23rd minute, Scholes spinning out of a tackle and going close before captain McGrath and Crosbie swept quick ruck ball out to Panter who finished smartly on the right.
Scannell added a tremendous conversion from wide out. But barely four minutes later, Italy were celebrating their third try, loose defending from John Andrew and Murphy allowing Campagnaro's replacement Benvenuti to strike from close range.
Padovani missed the conversion and Scannell pulled three points back with his first penalty in the 34th minute, cutting the gap to 10 points for the interval.
Italy, enjoying the platform of a powerful scrum, threatened to score again closing in on half-time but Conor Joyce and van der Flier won a crucial turnover five metres out.
The task was made much more difficult on the resumption was Padovani's kick out to the right put Odiete over despite a last-ditch challenge from Panter.
Padovani's conversion attempt drifted narrowly wide on the wind, and that was to prove important as Ireland seized some control for the closing 35 minutes.
A feature of Ireland's performances in this year's Under-20 Six Nations has been their strong finishes, most notably at home to England and France.
Against the Azzurrini, they got back into contention thanks to a pushover 59th minute try from Sexton, the younger brother of Leinster and Ireland's Jonathan Sexton.
Forwards Bryan Byrne, Brian Scott and Sexton made a positive impact off the bench as they helped to tee up the try from a close-in lineout, the Italian defence splintering as the well-executed maul drive reached its intended destination.
Scannell then suffered his two missed kicks, drawing the difficult conversion wide and missing a 64th minute penalty from outside the 10-metre line.
But with the Irish second row and back row growing in their influence, Ruddock's charges were quickly back on the attack. They ran the Italians to the right and left near their 22 before Scannell popped over a 67th minute penalty.
As the pressure increased on Italy, Ireland created their third try of the night. The determined Donnan and Murphy threatened after an initial lineout drive, before Crosbie hung up a cross-field kick for the leaping Scholes to gather and touch down under pressure from a covering defender.
Scannell's pinpoint conversion tied things up at 25-all with five minutes to go. A subsequent break on the left from Scholes saw Ireland threaten again but Crosbie's missed drop goal from distance was the closest they came to sneaking the win.
An away victory may have eluded McGrath and his team-mates in the Six Nations, but this was a character-building comeback and another glimpse of the type of resilient play that they will need to show during the summer's IRB Junior World Championship.
Referee: Alexandre Ruiz (France)