Rome: Italy's Prime Minister has announced his resignation as he made a blistering attack on his own interior minister, Matteo Salvini, accusing him of sinking the ruling coalition and endangering the economy for personal and political gain.

Prime Minister Giuseppe Conte, addressing Parliament after it was recalled from its summer recess to decide the future of the barely year-old government, accused League party chief Salvini of seeking to cash in on his rising popularity.

"[Salvini] has shown that he is following his own interests and those of his party," Conte told a packed Senate on Tuesday, local time, with a stony-faced Salvini sitting by his side. "His decisions pose serious risks for this country."

He described the actions of Salvini, who declared the coalition unworkable 12 days ago and called for snap elections, as recklessness "liable to tip the country into a spiral of political uncertainty and financial instability".