- The mother and baby were the 288th and 289th corpses found by divers
- Horrifying detail emerged after EU commissioner asked why one coffin was so large, unaware mother and child were being buried together
- Premature male baby still attached by umbilical cord when rescue divers pulled their corpses from the wreck
- Diver who found them said: 'We all began to cry - my mask was full of tears'
A baby, born as its mother drowned, is among the latest victims of the boat tragedy that has claimed the lives of more than 300 migrants off the coast of Sicily.
Their fishing boat caught fire and sank last Thursday just half a mile offshore.
The Eritrean woman, who was seven months pregnant, would have given birth in her death throes, the mayor of Lampedusa Giusi Nicolini told reporters.
The premature male baby was still attached by the umbilical cord when rescue divers pulled their corpses - 288 and 289 - from the wreck.
The child will be buried in the same coffin as its mother rather than in a small white coffin like the other children. The mother herself was only around 20 years old.
The tragic story only emerged when European Union Commissioner Jose Manuel Barroso asked why one coffin was noticeably bigger than the rest, the Italian newspaper Il Messagero reported.
The newspaper wrote: 'It was up to the mayor of the island to tell the terrible, unimaginable events.
'Doctors had told her an Eritrean woman had died and as she died she brought her son into the world. They didn't even separate, there was no time.'
Police diver Renato Sollustri said he had not slept since he had brought up the two corpses, the baby hidden in the folds of his mother's white leggings, under pulled-down trousers.
He said: 'It was three in the afternoon when we finally got into the last cabin in the bow after having got past a wall of bodies.'
The divers still had ten minutes' oxygen left when they got to the last cabin in the bow and saw a mother with a baby bump.
Mr Sollustri told La Repubblica: 'We couldn't leave without doing something for her. We took her out forming a human chain with our arms. Then we lay her on the sea bed.
'With a rope we joined her to the other bodies and with buoyancy aids we took them towards the light.
'It wasn't until we passed the body to our colleagues in the boat that they made the shocking discovery - in her leggings was a newborn baby.
'None of us could believe it. We all began to cry - my mask was full of tears.'
The police marshall said he had never before lost control in the job, but added: 'In front of that newborn baby I lost my cool.
'The baby may never have seen light - only the darkness at the bottom of the sea. It was a horrible job.'
Italian premier Enrico Letta has ordered that all the victims be given state funerals. They are to be buried in a cemetery in Sicily.
His government is now on track to repeal the offence of illegal immigration which, under a 2002 law, meant that all the survivors were automatically facing criminal charges.
On Wednesday a Senate committee approved an amendment to cancel the offence.
Deputy Interior Minister Felipe Bubbico said a more 'global' approach was needed to manage immigration.