Other interesting matchups include Czech Republic Germany and Slovakia in Group D and Sweden Spain and Denmark in Group F.
Former European and world champion France three-time World Cup winner Italy and emerging Ukraine were drawn into the same qualifying group Friday for the 2008 European Championship.
Three more World Cup-bound teams - Portugal Poland and Serbia-Montenegro - were put together in Group A which was almost as difficult as France's Group B.
Only the top two teams from each of the seven groups will join co-hosts Switzerland and Austria in the final tournament in 2008. Fifty teams will play in the qualifying campaign.
Other interesting matchups include Sweden Spain and Denmark in Group F and the Czech Republic Germany and Slovakia in Group D.
"It will be a battle in each of the games Germany coach Juergen Klinsmann said.
France has not lost to Italy since the 1978 World Cup and the team beat the Azzurri in the 2000 final and in the 1998 World Cup quarterfinals.
"I am happy to play against Italy France coach Raymond Domenech said. "It's a big team. I've wanted to play Italy."
Italy coach Marcello Lippi knew the draw on the shores of Lake Geneva could have been better.
"Ukraine which is a growing power France and Scotland are tough opponents he told SKY Italia television network.
Besides the two tough groups several bitter rivalries will be renewed.
Defending champion Greece plays Turkey in Group C. The Turks eliminated Greece from the World Cup in Germany. Norway is also in that group.
"Turkey and Norway are very good teams and I think it will be them and us fighting for the top two slots Greece defender Traianos Dellas said.
In Group A Caucasian rivals Armenia and Azerbaijan were drawn together. The Czech Republic and Slovakia who were part of the same country until 1993 are in Group D.
"We know each other very well. It's an interesting matchup Slovakia coach Dusan Gallis said. "But I don't see a problem in the rivalry we're very good friends and it won't be over the top." Gallis played for Czechoslovakia when it won the European title in 1976.
Perennial favorite England is still looking for its first title and was drawn with Croatia Russia and Israel in Group E. Sven-Goran Eriksson who will leave after the World Cup said his successor should not complain about the task ahead.
"There are groups which are much more difficult than the England group so I think it's very good he said. "England fans and the man coming after me will be happy."
In Group F Sweden and 1992 champion Denmark are two northern neighbors drawn together with Spain adding to the excitement.
The Netherlands the 1988 champion plays in an overwhelmingly eastern European Group G with Romania Bulgaria Slovenia Albania and Belarus.
Still coach Marco van Basten was pleased especially after he was drawn in the toughest World Cup group last month with Argentina Serbia-Montenegro and Ivory Coast.
"We had a good draw compared to the World Cup. It is better for us Van Basten said.
Switzerland will play the opening match at Basel's St. Jakob Park on June 7 2008 and the final of the 16-nation tournament will be in Vienna on June 29.
Bern Geneva and Zurich also will host games in Switzerland and Innsbruck Klagenfurt and Salzburg will host games in Austria.