(CNN) Spain's reign as champion of Europe came to a shuddering halt Monday as Italy claimed a famous 2-0 win in Paris.

Italy, beaten 4-0 by the Spanish in the final four years ago, produced a fine performance to set up a quarterfinal tie with world champion Germany.

Giorgio Chiellini's 33rd-minute goal gave Italy the lead, and Graziano Pelle smashed home a second in stoppage time to seal the win.

For eight years, Spain has enjoyed its role as champion of Europe but it had no answer to an Italian team set up brilliantly by coach Antonio Conte.

#Chiellini : "We had unfinished business and we finally got one over them but we should have finished it earlier." #ITAESP #EURO2016

This was a brave and committed display from an Azzurri side which few had given a chance of reaching the later stages of the tournament.

Spain had its chances of its own but could not find a way past the Italian defense and was almost inevitably punished when Pelle rounded off a rapid counter-attack.

Photos: Euro 2016: Day 16 Wayne Rooney walks over to console his teammates -- from left, Gary Cahill, Joe Hart and Dele Alli -- after England were upset 2-1 by Iceland on Monday, June 27. Iceland will play France in the tournament's quarterfinals. England has been eliminated. Hide Caption 1 of 15 Photos: Euro 2016: Day 16 Kolbeinn Sigthorsson, left, celebrates after scoring Iceland's second goal in the 18th minute. Hide Caption 2 of 15 Photos: Euro 2016: Day 16 English goalkeeper Joe Hart got a hand on Sigthorsson's shot but couldn't bring it in. Hide Caption 3 of 15 Photos: Euro 2016: Day 16 Iceland's Ragnar Sigurdsson attempts an overhead kick in the English box. His goal in the sixth minute tied the match at 1-1. Hide Caption 4 of 15 Photos: Euro 2016: Day 16 The match started brightly for England after captain Wayne Rooney scored a penalty kick in the fourth minute. Hide Caption 5 of 15 Photos: Euro 2016: Day 16 Iceland supporters cheer on their team at the stadium in Nice, France. Hide Caption 6 of 15 Photos: Euro 2016: Day 16 England fans watch the match in Nice. Hide Caption 7 of 15 Photos: Euro 2016: Day 16 Italian forward Graziano Pelle scores a late goal to finish off a 2-0 win over Spain on Monday, June 17. Italy will play Germany in the quarterfinals. Hide Caption 8 of 15 Photos: Euro 2016: Day 16 Italian players react after Pelle's goal in second-half stoppage time. Spain, the European champions in 2008 and 2012, had defeated Italy in the 2012 final. Hide Caption 9 of 15 Photos: Euro 2016: Day 16 Spanish midfielder Koke, left, eyes the ball next to Italy's Alessandro Florenzi. Hide Caption 10 of 15 Photos: Euro 2016: Day 16 Italian goalkeeper Gianluigi Buffon snatches a ball away from Spain's Aritz Aduriz. Hide Caption 11 of 15 Photos: Euro 2016: Day 16 Italian midfielder Daniele De Rossi (No. 16)heads the ball in the box. Hide Caption 12 of 15 Photos: Euro 2016: Day 16 Italian manager Antonio Conte shouts during the match. Hide Caption 13 of 15 Photos: Euro 2016: Day 16 Giorgio Chiellini, left, scores the opening goal in the first half. Spanish goalkeeper David De Gea spilled a free kick from Eder, and Chiellini was there to finish after a goalmouth scramble. Hide Caption 14 of 15 Photos: Euro 2016: Day 16 Chiellini celebrates with Eder, center. Hide Caption 15 of 15

Confidence

The Italians began with a confidence and swagger which left their opponents chasing shadows in the opening stages. Spain goalkeeper David De Gea, overworked in the first period, produced an astonishing save to deny Graziano Pelle after the striker powered his header towards the bottom corner from Alessandro Florenzi's cross.

Italy, which topped Group E, continued to thrive and Emanuele Giaccherini forced De Gea into another fine save with an overhead kick, though his effort would have been ruled out for a high foot if it had found the net.

Spain, beaten by Croatia in its previous match to finish second in Group D, looked lackluster, lethargic and unable to find a way to cope with Italy's ability to break on the counter attack.

Spain captain Sergio Ramos almost sliced the ball into his own net as Italy continued to whip dangerous crosses into the penalty area.

With 12 minutes of the first half remaining, Italy finally gained its reward.

Pelle was cynically fouled by Ramos about 20 yards from goal and, when De Gea failed to hold Eder's effort, Chiellini reacted first to force the ball home.

JUST WATCHED Euro 2016: Iceland commentator screams for his team Replay More Videos ... MUST WATCH Euro 2016: Iceland commentator screams for his team 01:13

Buoyed by the goal, Italy went close again just before halftime with De Gea once again called into action to palm Giaccherini's exquisite curling effort over the crossbar.

Leading at the interval, Italy's only regret would have been its inability to make the most of its chances.

That failure appeared likely to prove costly as Spain, so anemic in the first half, began to find its feet and should have equalized within three minutes of the restart.

Alvaro Morata, scorer of three goals in his previous three games, found space inside the penalty area but could only send his header straight at the goalkeeper from close range.

It was a poor miss from the striker -- who is returning to Real Madrid after two seasons in Italy with Juventus -- and only served to increase the frustration of his teammates.

Spain's increased tempo and decision to push forward began to increase pressure on an Italian defense which had been breached just once during the group stage -- during the 1-0 defeat by Ireland, after Italy had already qualified for the last 16.

But Spain's desire to move forward left gaps for Italy to exploit and De Gea had to rescue his side once again when Southampton striker Pelle played Eder through on goal only for the Brazil-born forward to shoot straight at the goalkeeper.

Late drama

Spain, with Lucas Vazquez on in place of the ineffective Morata, continued to pile forward at every opportunity and Andres Iniesta unleashed a wonderful left-footed volley which Italy goalkeeper Gianluigi Buffon palmed over the crossbar.

Buffon was growing ever busier and Gerard Pique forced the 38-year-old into a full-stretch save as Spain began to turn the screw.

Conte ran immediatly to his wife and... pic.twitter.com/6Bq3UNHPpy — Fabrizio Romano (@FabrizioRomano) June 27, 2016

Spain was growing increasingly desperate but in the final minute of the contest it created its best chance of the game, with Barcelona defender Pique poking towards goal from eight yards only for Buffon to produce an outstanding save.

It proved a vital save as Italy raced down the other end almost immediately. Manchester United's Matteo Darmian picked out Pelle at the far post, the 30-year-old volleyed home emphatically to finally put the result beyond doubt.

It was Spain's first defeat in a knockout game at a major tournament since 2006 and leaves Italy facing a date with Germany in Bordeaux on Saturday.

Germany, which thrashed Slovakia 3-0 in the last 16, has never beaten Italy at a major international tournament.

"We're facing two of the best teams in the world in the space of a few days," Chiellini told reporters.

"There were several games we needed to take revenge for but we also wanted and deserved this victory.

"We waited too long before killing the game off, too. We deserved to finish it earlier, and we suffered in the last 15 minutes. But there was a saint behind us, and he stopped everything."