Rabya Usman Sayyid Ahmad, also known as "Muhammad the Egyptian", can appeal to Italy's Supreme Court and final approval for extradition must be given by Justice Minister Roberto Castelli.
"In the past days ... the minister has said that if the court ruled in this way, he would approve the extradition without problems," said a spokesman for Castelli on Saturday.
Spanish authorities have blamed the Madrid attacks on Islamic dissidents acting in the name of al-Qaida.
Linked to ringleader
They have linked Ahmad, who was arrested in Milan in June, to Sarhan bin Abd Al-Majid Farkhit - known as "The Tunisian" - whom they consider to be the ringleader of the bombings.
Farkhit, 35, was among seven suspects who blew themselves up in a confrontation with police in April rather than surrender.
Aun is the 25th suspect formally
accused in the Madrid bombings
In Madrid, a judge probing the bombings formally accused Lebanese national Mahmud Sulayman Aun, who uses multiple identities, of collaboration with a "terrorist" group and ordered him jailed without bail, judicial sources said.
Aun was the 25th suspect formally accused in connection with the bombings on four packed commuter trains.
He appeared before a Spanish judge two days after being arrested in a Madrid suburb, carrying documents identifying him as a 44-year-old Portuguese citizen from Mozambique.
Mobile phone records showed he knew several other suspects, and hours after the attacks was close to a house where the explosives were thought to have been prepared, said the judicial sources.