TARANTO, Italy — In his corner store next to Europe’s largest steelworks, Giuseppe Musciacchio dragged his index finger across a shelf caked in gray dust.

Outside, a towering smoke stack loomed above a landscape of blast furnaces and stockpiles of dangerous minerals. Dark puffs of industrial exhaust drifted in the sky like rain clouds. On “wind days,” the mayor cancels school for fear of toxic dust blowing through the town.

“I’m constantly cleaning,” Mr. Musciacchio said, showing how the metallic soot stuck to a magnet. Photographs on the wall honored his mother and other relatives who he said had died of cancer. “They died from living here, breathing here.”

Even so, as Italy’s government and the factory’s foreign operator, the steel giant ArcelorMittal, engage in a high-stakes fight over the plant’s future, Mr. Musciacchio hopes it will not close. “It would be an economic disaster,” he said.