The first Nobel laureate to reach 100 years of age, she won the prize in 1986 with American Stanley Cohen for their discovery of nerve growth factor (NGF), a protein that makes developing cells grow by stimulating surrounding nerve tissue.
Her research helped in the treatment of spinal cord injuries and has increased understanding of cardiovascular diseases, Alzheimer's and conditions such as dementia and autism.
One of twins born to a Jewish family in Turin in 1909, Montalcini was the oldest living recipient of the prize.
During World War Two, the Allies' bombing of Turin forced her to flee to the countryside where she established a mini-laboratory. She fled to Florence after the German invasion of Italy and lived in hiding there for a while, later working as a doctor in a refugee camp.
She also set up a research unit in Rome and in 1975 became the first woman to be made a full member of the Vatican's Pontifical Academy of Sciences in 1975. She won several other awards for her contributions to medical and scientific research.
Her face was instantly recognisable in Italy and she was well known as a dignified and respected intellectual, a counterbalance to the image of women succeeding through their looks and sexuality, exacerbated during the scandal-plagued era of former prime minister Silvio Berlusconi.
Two days after her birthday in April this year she posted a note on Facebook saying it was important never to give up on life or fall into mediocrity and passive resignation.
"I've lost a bit of sight, and a lot of hearing. At conferences I don't see the projections and I don't feel good. But I think more now than I did when I was 20. The body does what it wants. I am not the body, I am the mind," she said.
Italian Prime Minister Mario Monti said in a statement that Montalcini's Nobel prize had been an honour for Italy, and praised her efforts to encourage young people, especially women, to play a central role in scientific research.
Editing by Louise Ireland