The search giant has come under heavy fire over privacy controversies recently, and this latest development won't help perceptions the company is struggling with its stated ethos of "don't be evil."
"Cars belonging to the giant of Mountain View roamed Italy's streets without being entirely recognisable as such, therefore not allowing the people present in those places to decide whether to be photographed or not," Italy's data protection regulator said in a statement today.
Google, while paying the fine, issued a statement of its own saying "The fine from the DPA relates to an old case that dates back to 2010. We complied with everything the (regulator) required of us at ` time," according to a spokeswoman with the company.
Reuters reported the fine announced on Thursday relates only to vehicles not being labelled clearly enough, and that the watchdog has also reported to Italy's judicial authorities that Google accidentally captured fragments of electronic communications as part of its mapping research in the country.
Imposing its higher fine on Thursday, the Italian watchdog said it took into account the search engine operator's "consolidated revenue of over $50 billion".
It also said Google had "promptly adopted the measures it requested", including clearly marking the cars used to collect footage, and broadcasting details of the areas the cars would visit on its own website and in local media.
Late last year the company was fined $1.4 million for 'serious violations of users' privacy' in Spain.
The Spanish Data Protection Agency, Spain's privacy watchdog, accused the US-based multinational search giant of 'illegal processing of personal data' obtained from users.
"Google unlawfully collects and processes personal information' of users" the agency said in a statement in December.
"The agency considers that Google seriously violates the right to the protection of personal data."