The captors - calling themselves The Islamic Army in Iraq - did not threaten Baldoni directly, but said they could not guarantee his safety unless Italy announces within the next 48 hours that it will withdraw its 3000 troops from Iraq, Aljazeera reported on Tuesday.
The video showed a passport that identified the man as Baldoni and included a clip of the man purported to be the journalist.
The Italian Foreign Ministry reported Baldoni missing last Friday and said he was believed to be in Najaf which has seen heavy fighting between Shia leader Muqtada al-Sadr's al-Mahdi Army and US occupation forces for nearly three weeks.
Baldoni is a freelance journalist covering Iraq for the news magazine Diario. The magazine's editor-in-chief, Enrico Deaglio, told a news agency on Friday that he last heard from Baldoni on 18 August.
The capture of the Italian journalist comes close on the heels of the kidnapping of a British reporter from Basra and a US journalist in Nasiriya. Both of them were subsequently released on the intervention of Shia leader Muqtada al-Sadr.
Two French journalists are also reported missing since Saturday.