In 1866 Pope Pius IX, whose temporal domain had been reduced to only the province of Latium, decided to match its coinage to the Latin Monetary Union.

The Papal States was never a formal member of that currency union, but this coinage was used in all of its neighboring countries.

The lira, was introduced with the same value of the French franc and the Italian lira replacing the scudo at a rate of 5.375 lire = 1 scudo : the rate was calculated thanks to the silver value of the old scudo (26.9 grams of 0.900 fine silver[citation needed]) and the new lira (5 grams of 0.900 fine silver).

Silver denominations below 5 lire were 0.835 fine, according to the Latin Monetary Union standard.

The lira was subdivided into 100 centesimi and, differently from the other currencies of the union, into 20 soldi.