"He is calm, he is talking and joking. The doctors are very positive," the BBC quoted Ncoletta Montavani, the singer's his second wife and former assistant, as saying.
A spokesman for the Modena University Policlinico in northern Italy has said that Pavarotti's condition is "satisfactory, and that the 71-year-old singer is expected to be discharged in the next few days.
According to a hospital spokesman, Pavarotti was admitted on Wednesday.
A local newspaper reported that the signer was diagnosed with pneumonia while he was enjoying a holiday with his family at a resort on the Adriatic seaside, while other local media claimed that he had a respiratory infection complicated by kidney problems.
The recent past had been full of bad luck for Pavarotti. In March 2005, he had neck surgery to repair two vertebrae. A bout of laryngitis forced him to cancel an appearance at a Three Tenors concert in Mexico in June last year.
The singer also had back surgery and contracted an infection while in hospital, which forced him to cancel further concert dates.
Mantovani, however, said last month that her husband was "fighting like a lion".
"He has never lost his heart, also because a family he adores is by his side," she told Italian newspaper La Stampa.