The film awarded the Golden Lion on Saturday stars Mickey Rourke as a wrestler forced into retirement who strikes up a romance with an aging stripper played by Marisa Tomei.
Russia's Aleksey German Jr. won the award for best director for "Bumaznyj soldat (Paper Soldier)," a story set in the early days of the space program in the Soviet Union.
Italian Silvio Orlando was crowned best actor for his role in Pupi Avati's "Il Papa' di Giovanna," (Giovanna's Father), about a father's relationship with his troubled adult daughter.
France's Dominique Blanc won best actress for playing a jealousy-struck woman in "L'Autre (The Other One)," directed by Patrick Mario Bernard and Pierre Trividic.
Italian director Ermanno Olmi received the Venice Film Festival's Golden Lion for lifetime achievement on Friday.
The 77-year-old director won the Golden Lion at Venice for "La Leggenda Del Santo Bevitore (The Legend of the Holy Drinker)" and the Palme D'Or at Cannes for "The Tree of Wooden Clogs (L'Albero Degli Zoccoli)."
During a press conference, Olmi recalled being inspired by the Italian neorealism of Roberto Rossellini and Vittorio de Sica.
He said audiences didn't know how to react to Rossellini's postwar masterpieces "Roma Citta Aperta (Open City)" and "Germania Anno Zero (Germany Year Zero)" because the movies made them too uncomfortable.
"The cinema of Rossellini, of Di Sica ... is a cinema of the honest men of neorealism, one that has the value of allowing you to recognize yourself on the screen," Olmi said.
Olmi also said he has seen signs of a renaissance in Italian filmmaking in the last few years, citing films such as "il Divo," a lively portrait of former Premier Giulio Andreotti by Paolo Sorrentino, which was honored at Cannes this year.
"Cinema is beginning again to be aware of being an instrument of civility," Olmi said.
The jury cited Armella's capacity to "tell in (a) few minutes and in one space a dramatic tale of misery and loneliness."
Armella said that the most difficult part in making the film was keeping it simple.
"The goal was to provoke from the audience the feeling of having witnessed a very hard, tragic moment but without ever actually having seen it," Armella said in a statement.
The 30-year-old director studied scriptwriting in Mexico and filmmaking at the London Film School. He co-directed and edited "Toro Negro," which won awards at the San Sebastian and the Havana film festivals, as well as "Born Without," which won a prize at the Mexico City International Contemporary Festival.