ROME (AFP) - The grotto where a she-wolf suckled Rome's founders Romulus and Remus, according to legend, has been discovered in the heart of the capital, Culture Minister Francesco Rutelli said Tuesday.

"Italy and Rome never stop amazing the world with continual archaeological and cultural discoveries, and it is incredible to think that we have finally found a mythological site that has become a real site," Rutelli told reporters.

The domed underground cavity, elaborately decorated with seashells and mosaics, was discovered near the ruins of Emperor Augustus's palace on Rome's Palatine hill using a camera-equipped laser probe, Maria Bonmassar of the Italian culture ministry told AFP.

Known as the Lupercale, it is thought to be where ancient Romans held an annual pagan celebration honouring the shepherds' god Faunus Lupercus, who protected flocks from attacks by wolves.

The grotto, which is some six and a half metres (21 feet) high and seven metres in diameter is on a site dating from the Bronze Age, said Bonmassar.

Legend has it that Romulus killed his brother Remus in a quarrel over the height of the city walls and went to become the sole ruler of Rome in 753 BC.

A bronze statue of she-wolf suckling the infants, with pride of place at the entrance to City Hall at Rome's Campidoglio, has become an enduring symbol of the Eternal City.

Digging to the grotto will begin next year, Bonmassar said.