The Italian interior ministry said there had been "no escape of illegal immigrants" because it was a camp for assistance rather than expulsion, "so there is no obligation to stay there".
Many were already returning to the camp, it said in a statement.
The UN High Commissioner for Refugees (UNHCR) expressed concern over the camp conditions on Friday, where Italy holds people picked up or rescued trying to cross the Mediterranean from North Africa in small boats.
The UNHCR said it is only built for 850 people but now has up to 2,000 crammed in, many sleeping under plastic sheets.
Originally a temporary stop for people waiting for transfer to other centres in Italy, the camp's role has changed this year with tough new immigration rules meaning all those rescued are kept in Lampedusa until being granted asylum or expelled.
Roberto Maroni, the interior minister, announced last month that immigrants would be sent straight back to their country of origin instead of being transferred to other centres on the Italian mainland, as had been the practice.
Many locals are opposed to Italian government plans to build a new camp to identify and expel illegal immigrants, which they say would turn the island into a "sort of prison" rather than a humanitarian centre for refugees rescued from the sea.
|De Rubeis is opposing government plans to build a new holding camp [EPA]
De Rubeis, who leads opposition to the new camp, urged protesters to return, saying: "Only if you return peacefully to the centre can you be transferred out of here."
Silvio Berlusconi, Italy's prime minister, who has introduced tough immigration rules that speed up expulsions, said "the people of Lampedusa can be calm because the situation is under control".
"This situation does not depend on the government but on the fact that Lampedusa is the part of Italy nearest to Africa."
About three-quarters of migrants reaching Italy by sea last year applied for asylum, half of whom got refugee status or protection on humanitarian grounds, UNHCR said.
Italy's interior ministry estimates that 31,700 immigrants landed on Lampedusa in 2008, a 75 per cent increase on the previous year.