Bartolomeo Gagliano is armed and "dangerous," Genoa police official Fausto Lamparelli said. He urged people who think they might have spotted Gagliano to quickly call police.
There are fears that the fugitive might have driven across the nearby border into France.
Courts held Gagliano, now 55, responsible for the fatal stoning of one prostitute and the wounding of another in 1981, but ruled him mentally incapable of understanding the crime and ordered him to an asylum for the criminally insane, according to authorities. After escaping in 1989 from the asylum, he killed, along with another man, a female transsexual and a male transvestite, and was again sent to a criminal asylum for psychiatric treatment, authorities quoted in Italian news reports said.
Gagliano being granted a good behavior pass despite a record of escapes and violence sparked an outcry in Italy. Justice Minister Anna Maria Cancellieri was scheduled to brief the Chamber of Deputies on the case Friday morning.
"We can make the best laws in the world, but if we have magistrates and prison directors who make such big mistakes, no law can stand up to that," lawmaker Marco Di Lello said.
Genoa's Marassi Prison director, Salvatore Mazzeo, insisted in several Italian TV interviews that Galgiano had been sent to his prison in 2006 for a robbery conviction. A justice ministry penitentiary administration official, Luigi Pagano, told Radio 24 that Gagliano had been due for release in about a year.
Authorities said while Gagliano was allowed out earlier this week on a two-day pass to visit his mother in Savona, on the Ligurian coast, he forced a bakery worker at gunpoint to start driving him away. He later ordered the driver out of the car and drove off himself.
Corriere della Sera quoted the baker, whom it didn't identify, as saying that Gagliano told him he had spent long periods in prison and at a certain point "suddenly ordered me to stop, said he had enough of prison, and he was getting away."
Genoa newspaper Il Secolo XIX quoted magistrate Daniela Verrina, who signed off on the pass, as saying that prison reports about Gagliano indicated "no psychopathological signs."
The paper reported that Gagliano had received another good behavior pass earlier this year which let him on condition he be accompanied by the prison chaplain and another one that let him visit the mother, and that both times Gagliano returned to prison.