The gulf in class between the world champions and 78th-ranked New Zealand ahead of their Group F match at Nelspruit's peculiarly-designed stadium should be obvious, but Italy are taking their usual cautious approach to extremes.
"Undoubtedly from a technical point of view we shouldn't fear them but we have to be wary of their physicality and their heading ability, they are all very tall," Lippi told a news conference on Saturday.
"It's a match where we will have to pay great attention to dead balls. The more we keep them away from around our box, the better. We have lots to lose, like getting through the group."
Italy captain Fabio Cannavaro, much smaller than an average centre back, was caught out by Antolin Alcaraz's header in Monday's opening 1-1 draw with Paraguay and all Italy players have talked about this week is New Zealand's height.
Azzurri fans would probably rather the focus was on how Italy's misfiring strikers are going to rip apart their prey at the gateway town for Kruger National Park, but confidence is so fragile that strong defence has been the watchword.
Midfielder Andrea Pirlo, who missed the Paraguay match, will again be on the sidelines because of a calf injury but may be able to make the final group game against Slovakia on Thursday.
"He is improving day by day. From Monday he will train with the group but I don't know what intensity he will be able to do it," Lippi said.
Gianluigi Buffon is also out with a herniated disc in his back but Lippi denied reports the goalkeeper's World Cup is over as Italy continue to believe he can return in the latter stages.
"He's trying to recover. He's getting better day by day and we haven't lost the hope of playing him," Lippi said.
Team doctors have been giving Buffon cortisone injections and a decision on whether he needs an operation on his back will only be made after the tournament.
Federico Marchetti, who came on for Buffon at halftime against Paraguay, will again deputise but Lippi refused to speculate on the rest of his team amid speculation Mauro Camoranesi could replace Claudio Marchisio in a 4-4-2 formation.
"If a team bemoans the loss of someone who isn't there it's the worst thing to do. We have other players who are good enough. But at the same time we try to get our top players back," Lippi concluded.
