Italy coach Cesare Prandelli insisted he was unworried by his side's latest friendly defeat after watching the Azzurri lose 1-0 to Uruguay.

It was the third time Italy had lost a friendly in 18 months under Prandelli, while enjoying an unblemished record of eight wins and two draws in their European Championships qualifying campaign.

But Prandelli felt his team had actually performed better at the Stadio Olimpico than they did in Friday's 2-0 friendly win in Poland.

"I thought we played better than we did in the last game, I thought we played a great match," said Prandelli.

"Obviously when you play against a team that arrives with great self confidence, who were fourth in the World Cup and won the Copa America, we did the most we could do in this moment, against this team.

"We can improve, this team has a huge margin for improvement. We fought to the end, the players are disappointed but they know they're on the right path.

"This is only a friendly so we must continue with our spirit, if the team responds as it has done it means we're on the right path."

As for why his team has become more vulnerable in friendlies than competitive games—they have also lost 1-0 to Ivory Coast and 2-0 to the Republic of Ireland—Prandelli was at a loss.

"It's not a question of concentration, I think we played an excellent game, we didn't treat it like a friendly," he said.

"If I close my eyes and think back to 18-months ago and the thought of playing Uruguay in Rome and playing at this level, there would be doubts but we're becoming a team."

However, he wasn't entirely happy with the third minute goal they conceded to Sebastian Fernandez.

"We had a huge numerical superiority in the area so we paid for a lack of concentration," he said.

"The reaction was good because we tried to come back, we created chances.

"They (Uruguay) are a team with great experience, they know how to manage a game.

"When we had the chance to attack they closed us down well."

Uruguay coach Oscar Tabarez said there was no surprise that the game was tight.

"Both teams are similar, it was a very difficult game in which to find space," he said.

"It was dominated by defences, there was little space in midfield. We played like we wanted to in defence but maybe we didn't do what we expected in attack.

"But we couldn't do a lot more because we had great players who weren't playing."

But for the South American champions this result rounded off an excellent last 18 months.

"It was a very significant game for us because it caps off a great sporting year for us," added Tabarez.

"This is part of the story of the rivalry between these two teams and winning in Italy is very important for us.

"We have to continue but we're satisfied also because when we asked young players to play they showed they were up to it.

"That gives us conviction, we know we can put our hand in the bag and be sure we'll find something."

As for Italy, Tabarez believes they are well on the way to recovering from their disastrous group phase exit at the World Cup in South Africa.

"They have many good young players with good technique, Italy keep the ball well," said the Uruguay coach.

"They've found a team like ours that works hard. It's not easy to get forward against them, when they play calmly and are concentrating like in the first half it's difficult.