Luna Rossa beat the highly fancied Team New Zealand on Thursday and gave their America's Cup campaign a massive boost in the process.
The Italian team managed a slender advantage for most of the race but they ran out relatively comfortable winners because the Kiwis were given a penalty turn, which they performed in the final straight when Luna Rossa had already crossed the finishing line.
"It was a good, difficult regatta," Luna Rossa skipper Francesco De Angelis said on Italian TV.
"We made good use of the penalty. We are happy, but when you look at the rankings were are still all bunched together.
"We have two more important races tomorrow and we have to keep going".
Before the start of the Louis Vuitton Cup, Team New Zealand were the favourites to win the right to challenge Swiss team Alinghi for the America's Cup.
But they have now been beaten by both of the top two Italian teams, after losing to Mascalzone Latino in the debut day of regattas last week.
The Kiwi crew are second in the table with 16 points.
The victory has dispelled doubts about whether the Luna Rossa yacht is as fast as its rivals - doubts that emerged Tuesday when they lost to the US BMW Oracle Team and to South Africa's Team Shosholoza.
The win also sets the stage for Friday's derby with Mascalzone, the other Italian crew with a good chance of reaching the Louis Vuitton Cup semi-finals.
Luna Rossa are third in the standings with 15 points, after winning six of the eight regattas they have disputed so far.
Mascalzone are fourth on 14 points with six wins from seven races.
They can regain third place on Thursday evening, but they will have to overcome the unbeaten American team to do so.
Mascalzone suffered their first defeat on Tuesday, when they lost to the Spanish Desafio Espanol 2007 team.
Italy's third America's Cup contender were looking for their first win on Thursday evening in the regatta with Team Shosholoza.
