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Balotelli forced Hart, his teammate at Manchester City, to save an acrobatic shot, then surged between England's central defenders before putting a half-volley over the crossbar. He kicked the goal post in frustration.
Italy continued surging in the second half and De Rossi, taking a ball over his shoulder, scuffed his shot wide. De Rossi sank to his knees in obvious exasperation, and more Italian frustration quickly followed.
Three rapid-fire chances in the 52nd saw Hart beat away De Rossi's long-range shot, block Balotelli's follow-up and watch Montolivo lash the loose ball high.
England coach Roy Hodgson had to react to Italy's dominance, and sent on substitutes Andy Carroll and Theo Walcott, who both scored in a 3-2 win over Sweden.
Carroll's muscular presence created a shooting chance for Young, but England still failed to convince. Rooney made little impression after an early diving header.
De Rossi was replaced by Nocerino and the substitute threatened in the 89th. He took another crafty pass from Pirlo on the run, but Johnson tracked back to block.
Deep into injury time, Italian defensive jitters created a chance for Rooney but his overhead kick sailed high.
Then it was on to penalties. And Diamante's heroics.
"Getting to this point is a huge satisfaction," Diamanti said. "I always believed I would, even when I played in the inter-regional division -- I just never told anyone, because they would have thought I was crazy."
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Lineups:
England: Joe Hart, Glen Johnson, Joleon Lescott, John Terry, Ashley Cole, James Milner (Theo Walcott, 61), Steven Gerrard, Scott Parker (Jordan Henderson, 94), Ashley Young, Wayne Rooney, Danny Welbeck (Andy Carroll, 60).
Italy: Gianluigi Buffon, Ignazio Abate (Christian Maggio, 90), Leonardo Bonucci, Andrea Barzagli, Federico Balzaretti, Daniele De Rossi (Antonio Nocerino, 80), Riccardo Montolivo, Andrea Pirlo, Claudio Marchisio, Mario Balotelli, Antonio Cassano (Alessandro Diamanti, 78).
[Associated Press;
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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