The Italians were among the top seeds in pot one and find themselves in Group H alongside Norway, Bulgaria, Azerbaijan, Malta and the dangerous Croatia.
Prandelli was pleased to avoid Belgium and Switzerland from pot two, but does not believe those sides are better than Croatia and also believes most of the teams in Italy's group offer a significant threat.
"It's true that we avoided Belgium and Switzerland, but I don't think that Croatia are inferior to those two teams that everybody wanted to avoid in pot two," he said.
"This is not as easy a group as many could think. Croatia and Bulgaria are potential group winners, Norway are a good side and Azerbaijan are improving fast."
With the finals in France not taking place for another two years, Prandelli will seek to integrate some of Italy's younger players in their qualifying campaign.
He added: "There are five or six players who played in the last Under-21 tournament and are very promising. We now have to integrate them."
