Italy have moved to within a point of Euro 2016 qualifying Group H leaders Croatia on Thursday as their rivals were deducted a point by UEFA.
UEFA announced that the Croatian Football Federation (HNS) had been docked one point because of the racist behaviour of their fans during the 1-1 draw with Italy in Split last month. Television pictures of the game showed how a swastika had been drawn on the pitch.
"The HNS has also been ordered to play its next two home matches in UEFA competition behind closed doors and not to play any of its remaining qualifying games at the Stadion Poljud in Split," UEFA said in a statement.
"In addition, the HNS has been fined €100,000. An appeal must be made within three days of the dispatch of the reasoned decision."
Croatia's federation described the punishment as "hard, the hardest in the history" of the association.
"This is the continuation of the heavy penalties inflicted on the Croatian association because of the hooligans' behavior," the statement said.
The federation can appeal to UEFA, and the governing body can also challenge the ruling. UEFA can ask its own appeals committee to impose a tougher penalty.
As a result, Croatia move onto 13 points, with Italy on 12. Norway are in third on 10 points, two more than Bulgaria. The top two qualify automatically for the finals in France with the third-placed side heading into a playoff.
With four rounds of qualifying still to be played, both Croatia and Italy remain on course for qualification, having already met each other twice.
They now have fixtures against sides below them in the table, with Italy hosting Malta and Bulgaria in their next two matches before travelling to Azerbaijan.
Croatia travel to Baku on Sept. 3 before arguably their most difficult away game against Norway in Oslo three days later.
The swastika was clearly marked in the middle of the half Italy was attacking in the first half. The match was played behind closed doors as punishment for racist chanting and other misconduct by Croatia fans at a previous Euro 2016 qualifier.
According to some reports in Croatia, the swastika was a fan protest against federation leaders and was intended to embarrass them by forcing UEFA to impose sanctions.
Croatia also has a core of right-wing supporters who identify with the World War II-era Ustasha regime.
Veteran defender Josip Simunic was banned for 10 matches, including all of the 2014 World Cup, by FIFA after leading fans in chanting an Ustasha slogan after Croatia won a playoff to qualify for the tournament. After beating Iceland, Simunic took a microphone on the field and shouted to supporters: "To the battle, to the battle for the homeland!" The fans responded: "We are ready!"
In a friendly with Italy in Livorno in 2006, about 200 Croatia fans formed a human swastika in the stands.
Information from The Associated Press was used in this report.