The move follows Italian parliament's go-ahead to a naval mission, which Italy says, will support the Libyan coastguard's fight against human traffickers.
Italy on Wednesday dispatched a navy patrol boat to Libya and seized an NGO rescue ship in dramatic steps aimed at ending the migrant crisis that has engulfed Europe in recent years.
The move comes minutes after Italian parliament gave a go-ahead to a naval mission in support of the Libyan coastguard's fight against the human traffickers behind the surge in migrants attempting to cross the Mediterranean.
The navy patrol boat Comandante Borsini entered the North African state's territorial waters on Wednesday afternoon, en route for the capital Tripoli, the navy said.
On board was a small advance team charged with coordinating planned joint actions with the Libyan coastguard.
Defence Minister Roberta Pinotti said Italy was providing technical support, not seeking to impose a "hostile" naval blockade designed to prevent the departure of migrant boats.
Italy announced the operation last week, saying it had been requested by Libya's UN-backed government.
It initially hoped to send six ships into Libyan territorial waters, but the plans had to be scaled back following protests from Tripoli.
"(We will) provide logistical, technical and operational support for Libyan naval vessels, helping them and supporting them in shared and coordinated actions," Defence Minister Roberta Pinotti said ahead of Wednesday's vote.
"There will be no harm done or slight given to Libyan sovereignty, because, if anything, our aim is to strengthen Libyan sovereignty," she told parliament
Italy had no intention of imposing a blockade on Libya's coast, she added.
TRT World's Simon McGregor-Wood reports.
Resistance in Tripoli
In Tripoli, a poster of resistance hero Omar al-Mukhtar, who battled Italian rule in Libya in the 1920s, was hung near the capital's main square with the inscription "No to a return to colonisation".
A parliament based in eastern Libya opposed to the UN-backed government issued a statement warning against "attempts by Italy ... to return tens of thousands of illegal immigrants to Libya".
After a surge in migrant arrivals from Libya at the start of the year, the number of newcomers has slowed.
The Interior Ministry said on Wednesday that 95,215 people had reached Italy so far in 2017, down 2.7 percent from the same period in 2016.
Some 2,230 migrants, most of them from Africa fleeing poverty and violence at home, died in the first seven months of 2017 trying to make the sea crossing.
Human rights warning
International rights groups have criticised Italy's moves saying people returned to troubled Libya face detention in squalid camps and abuse at the hands of traffickers.
"After years of saving lives at sea, Italy is preparing to help Libyan forces who are known to detain people in conditions that expose them to a real risk of torture, sexual violence, and forced labour," said Human Rights Watch's Judith Sunderland.
As many as 93,000 people have reached Italian shores so far this year. More than 2,000 have died trying.