Fr Sante Sguotti has made it clear that the relationship will remain platonic.
Interfax reports that he says there is no church prohibition against loving a woman.
The pastor in love has been supported by over 200 members of his parish at Monterosso near Padua.
At a referendum he himself arranged, they spoke in favour of his remaining to be a priest. Only 17 people including the local bishop wanted him to leave the office.
He said: "The law does not prohibit a priest to love or to be engaged to a woman if he stays celibate."
He has also urged all the priests in love to "come out".
The priest is not going to adopt the child.
Italian priest finds way to combine celibacy vows with love for woman (Interfax, 6/9/07)
LINKS (not necessarily endorsed by Church Resources)
Platonic love (Wikipedia)
3,000 young people ready to give all (CathNews, 6/9/07)
Bishops reaffirm celibate priesthood (CathNews, 16/8/07)