UPDATE 2-Soccer-Egypt stun world champions Italy

* Egypt first African side to beat Italy

* Upset result keeps Group B undecided

(adds Lippi quotes)

By Mike Collett

JOHANNESBURG, June 18 (Reuters) - Egypt scored their greatest ever victory with a thoroughly deserved 1-0 win on Thursday over world champions Italy who had never previously lost to an African team.

The shock result means Group B in the Confederations Cup hangs in the balance with all four teams still able to progress to next week's semi-finals.

Mohamed Hommos's goal five minutes before halftime clinched the first points of the tournament for the African champions, who narrowly lost 4-3 to Brazil in their opening game.

Most of the Egyptians and coach Hassan Shehata shed tears of joy at the final whistle as they became the first African side in 15 attempts to beat the Italians.

Key second half saves from veteran goalkeeper Essam Al Hadari, who had an inspired match, kept the Italians at bay while Vincenzo Iaquinta hit the crossbar with just minutes remaining as Egypt weathered a late onslaught.