The pirates surrendered and were arrested after two Navy ships, one British and one American, swooped on the Montecristo, which was seized on Monday.
The vessel's 23-man crew - seven Italians, six Ukrainians and 10 Indians - have been freed and are safe, according to a statement by the Italian foreign ministry.
Safety: Troops are hoisted on to the hijacked vessel. The 11 pirates who attacked it surrendered to the NATO boarding team with no resistance
On board: British Royal Naval troops board the pirated Italian merchant ship to carry out the dramatic rescue
The vessel was freed in a joint operation carried out by Royal Marines from the RFA Fort Victoria and the USS De Wert.
The two ships are part of Nato's operation Ocean Shield, set up to fight piracy in the seas off the Horn of Africa.
Lieutenant Gwenn Laine, a spokesman for Ocean Shield, told the NewsCore agency that the De Wert 'was the first ship to close in and assess the situation while the boarding team on Fort Victoria got ready.
'The crew of the [Montecristo] confined themselves in the engine room of the ship and they managed to send the information to Nato forces that they were safe and well.'
'Nato forces got on board and the pirates surrendered immediately,' Lieutenant Laine said, adding that there were no injuries.
Hovering: A helicopter hovers above the Montecristo during the operation to free the vessel in the Indian Ocean
Freedom: A British Royal Naval boarding team travel by boat during the operation.
The Montecristo, a 56,000-ton bulk carrier, was hijacked 620 miles off the coast on Somalia on Monday morning by five pirates in a small boat.
The crew took refuge inside an armoured shelter - known as the citadel - on the ship when it was hijacked and had continued to control its movements, bringing it closer to an area where anti-piracy forces were patrolling.
The move into the shelter appeared to be part of new measures agreed by seafaring nations to combat Somali piracy, which costs the world economy billions of dollars each year.
The USS De Wert sits alongside the Montecristo during the rescue operation
U.S. and British forces had boarded the ship under the orders of Italian Admiral Gualtiero Mattesi, commander of the Ocean Shield anti-piracy task force.
Britain's Ministry of Defence confirmed that the Royal Navy 'was involved in a compliant boarding' - in which the pirates indicated they would surrender and sailors boarded the vessel to take them into custody.
Eleven pirates were apprehended in the raid, the Italian foreign ministry's statement added.
Pirates flourish off largely lawless Somalia by attacking passing ships, taking hostages and demanding ransoms to free them and the vessels.
Raid: The Italian ship Montecristo docked in a harbour in Italy