On Sunday, flags flew at half mast, black banners hung from public buildings and civil servants wore black armbands, while state television broadcast only in black and white.
In the schools, teachers began the day with a speech reminding pupils of the "drama of their grandparents." Both airports and sea ports were closed, but have since reopened.
The state-run news agency JANA said "more than 5000 Libyans were uprooted from their land and deported to Italian islands by colonizers starting on 26 October 1911" in order to break the will of the resistance.
JANA said that the Foreign Ministry stressed that 26 October each year is a day of mourning in memory of thousands of men, women and children and elderly who were deported starting in 1911.
"In commemorating this historic crime which affected every Libyan family, the Libyan people demand their right to compensation from Italy," the statement said.
Libya also demands "to know the fate of these exiles and demands the return of their descendents if they are still living," it added.
"The Libyan people demand their right to compensation from Italy"
Libyan Foreign Ministry
On 7 October, Libyan leader Muammar Qadhafi threatened to boot Italian companies out of Libya if Rome did not provide compensation for acts committed in the colonial period from 1911-1942.
In July 1998, Rome and Tripoli signed a joint statement on the colonial period in which Italy apologised officially to the Libyan people for damages it caused during the occupation.
In the document, Italy pledged to help remove thousands of landmines still left in the country from World War II and build a hospital.
Qadhafi is demanding compensation, but Rome considers the issue settled by an agreement concluded in 1956 with King Idriss, who was overthrown by Qadhafi's coup in 1969.