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The decision "with immediate effect" will result in "the temporary limitation of the processing of Italian user data vis-a-vis OpenAI", the Italian Data Protection Authority said.
The agency has launched an investigation.
ChatGPT, created by US startup OpenAI and backed by Microsoft, can answer difficult questions clearly, write code, sonnets, or essays -- even passing difficult exams for students.
But the app that appeared in November is controversial, with teachers fearing students will use it to cheat, and policymakers concerned about the spread of misinformation.
The watchdog said that on March 20, the app experienced a data breach involving user conversations and payment information.
It said there was no legal basis to justify "the mass collection and storage of personal data for the purpose of 'training' the algorithms underlying the operation of the platform".
It also said that since there was no way to verify the age of users, the app "exposes minors to absolutely unsuitable answers compared to their degree of development and awareness."
It said the company had 20 days to respond how it would address the watchdog's concerns, under penalty of a 20-million-euro ($21.7-million) fine, or up to 4 percent of annual revenues.
The blocking of ChatGPT in Italy comes days after the European policing agency Europol warned that criminals were set to use the app to commit fraud and other cybercrimes, from phishing to malware.
glr-ams/ide/ach
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