Italy, which has seen over 60 governments since 1945, returned to political crisis when Romano Prodi, then prime minister, resigned after a series of political defections and the loss of a vote of confidence in January.
Napolitano, reluctant to send Italians back to the polls, had asked Franco Marini, the senate speaker, to see if he could gather enough support for a temporary government to reform the electoral system.
But after four days of talks with political leaders, Marini told Napolitano on Monday that he had failed to find a majority backing an interim administration.
Berlusconi, who has twice been prime minister, and other centre right leaders were consulted, but insisted on snap elections.
Recent voter surveys have shown Berlusconi's centre right opposition with a consistent lead, suggesting the media magnate could be returned to power in the snap polls.
But Berlusconi will face competition from Walter Veltroni, the popular mayor of Rome, new flag bearer for the left-leaning parties and successor to Prodi.
Many analysts say that another government elected under current electoral rules will prove just as unstable as Prodi's, who had been in power for only 20 months before his resignation.