Union staff in the Tuscan city of Livorno would not load the shipment, claiming they had discovered it was destined for the Israeli port of Ashdod.
“The port of Livorno will not be an accomplice in the massacre of the Palestinian people,” the L’Unione Sindacale di Base (USB) said in a statement.
The USB claimed the ship contained “weapons and explosives that will serve to kill the Palestinian population” – citing research by a Genoa-based campaign group called The Weapon Watch.
The arms shipment did make its way to Israel via Naples after other port workers continued to load the ship, according to The New Arab website.
USB workers would take part in street protests to call for “an immediate stop to the bombings on Gaza,” the union said in a statement.
Fighting spilled into a second week, as Israel bombed what it claimed were underground tunnels used by Hamas and Palestinian militants to fire rocket barrages at Israeli cities.
The Israeli military unleashed a wave of heavy airstrikes across the Gaza Strip early on Monday, saying it destroyed nine miles of militant tunnels, and the homes of nine Hamas commanders.
Residents of Gaza awakened by the overnight barrage described it as the heaviest since the war began a week ago even more powerful than a wave of airstrikes in Gaza City on Sunday that left 42 dead.
Gaza’s mayor, Yahya Sarraj, said the strikes had caused extensive damage to roads and other infrastructure. “If the aggression continues we expect conditions to become worse,” he said.
US secretary of state Antony Blinken on Monday urged all parties in the conflict to protect civilians and said Washington was working “intensively” to bring about an end to the violence.
Mr Blinken says he has not seen any Israeli evidence of Hamas operating in the Gaza media office building hit by airstrike over the weekend. The Biden administration official said he has asked Israel for justification for the strike.
At least 198 Palestinians have been killed in the strikes, including 58 children and 35 women, with 1,300 people wounded, according to the Gaza Health Ministry.
Eight people in Israel have been killed in rocket attacks launched from Gaza, including a five year old boy and a soldier, since conflict broke out last Monday, when the Hamas militant group fired long-range rockets at Jerusalem.
Watch: Palestinians stage protests on Nakba day
Additional reporting by agencies