View of Piazza del Duomo, Milan in the early 20th century.In 1919, Benito Mussolini organized the Blackshirts, who formed the core of Italy's Fascist movement, in Milan and, in 1922, the March on Rome began from the city. During the Second World War Milan suffered severe damage from British and American bombing. Even though Italy quit the war in 1943, the Germans occupied most of Northern Italy until 1945. Some of the worst Allied bombing of Milan was in 1944 and much of it focussed around Milan's main railway station. In 1943, anti-German resistance in occupied Italy increased and there was much fighting in Milan. As the war came to an end, the American 1st Armored Division advanced on Milan as part of the Po Valley Campaign. But even before they arrived, members of the Italian resistance movement rose up in open revolt in Milan and liberated the city. Nearby, Mussolini and several members of his Italian Social Republic (Repubblica Sociale Italiana, or RSI) were captured by the resistance at Dongo and executed. On 29 April 1945, the bodies of the Fascists were taken to Milan and hanged unceremoniously upside-down at Piazzale Loreto, a major public square.

The Pirelli Tower under construction, symbol of the post-war Italian economic miracle.After the war the city was the site of a refugee camp for Jews fleeing from Austria. During the economic miracle of the 1950s and 1960s a large wave of internal immigration, especially from Southern Italy, moved to Milan and the population peaked at 1,723,000 in 1971. During this period, Milan saw a re-construction of most of its destroyed buildings and factories, and was affected by a rapid post-war economic growth, called Il boom in Italy. The city saw the construction of several innovative and modernist buildings and skyscrapers, such as the Torre Velasca and the Pirelli Tower. Milan was, however, in the late-1960s until the late-1970s seriously affected by the Marxist/Leninist/Communist Italian group called Brigate Rosse, or Red Brigades, and the city was often filled with political manifestations and protests. A major event of this period of turmoil, known as the Years of Lead occurred in Milan on December 12, 1969, when a bomb exploded in the National Agrarian Bank in the Piazza Fontana, killing seventeen people and injuring eighty-eight.

The population of Milan begun to shrink during the late 1970s, so in the last 30 years almost one third of the total city population moved to the outer belt of new suburbs and small cities that grew around Milan proper.At the same time the city become to attract also increasing fluxes of foreign immigration. Emblematic of the new phenomenon is the quick and great extension of a "Milanese Chinatown", a district in the area around Via Paolo Sarpi, Via Bramante, Via Messina and Via Rosmini, populated by Chinese immigrants from Zhejiang, one of today's most picturesque districts in the city. Milan is also home to one-third of all Filipinos in Italy, harbouring a sizeable and steadily growing population that numbers just over 33,000 with a birth rate averaging 1000 births a year.

In the 1980s, Milan's industry began to be extremely successful. As it became a major exporter of textiles and several clothing labels headquartered in the city began to become internationally renowned (such as Armani, Versace and Dolce & Gabbana), Milan began to be recognized internationally as a major fashion capital, and the traditionally affordable and practical, yet stylish and chic attire produced by the city's stylists made it a serious global competitor, threatening Paris' century-long status as the world capital haute couture or high-fashion. The city also saw a rise in the number of international tourists, notably from China, Japan or other Far-Eastern countries. This period of prosperity and the new international image of the city being a "capital of fashion" led many journalists to call the metropolis during the period "Milano da bere", literally "Milan to drink".

In the 1990s, Milan was badly affected by Tangentopoli, a serious political scandal centered in the Palazzo delle Stelline complex, in which several politicians and businessmen were tried for alleged corruption. The city also underwent a financial crisis, and faced sluggish industrial growth, compared to that of the 1950s and 1980s. Despite this, Milan ripened its image as a fashion and design capital, with new labels such as Miu Miu setting up. By the late-1990s, Milan regained some slight industrial and economic stimulus to grow.

Expo 2015 logo.By the early 21st century, Milan's economy which had been stagnant in the early-1990s began to re-grow slightly again, yet this was short-lived and the city, despite having relieved itself from Tangentopoli's strain, fell into another economic recession and crisis. This period saw a rapid fall in Milan's industrial exports, and the Asian textile and clothing companies began to rival the still strong, yet declining Milanese fashion labels. However, Milan was able to maintain its strong economy, firstly by moving its Fiera (an exposition of products related to mainly industrial design) to a new establishment in Rho just outside the city,and the announcement in 2008 of the city hosting the Expo 2015 has brightened prospects for the city's future, with several new plans of regeneration and the planned construction of numerous avant-garde structures. Despite the decline in Milan's industrial production, the city has found alternative and successful sources of revenue, including publishing, finance, banking, food production, IT technology, logistics, transport and tourism Overall, Milan's population seems to have stabilized in recent years, and there has been only a slight increase in the population of the city since 2001.