Small islands have been considered at an advantage when dealing with infectious diseases, including COVID-19, but the evidence is still lacking. Crude mortality rates (CMRs) and excess mortality rates (EMRs) were calculated for 35 municipalities on the Italian small islands for 2020 and 2021, and the corresponding estimates were compared to those of the parent provinces and the national estimates. Notification rates for COVID-19 were retrieved, but detailed data at the municipality level were not available. A relatively low CMR (1.069 per 100 per year, 95% confidence interval [95% CI] 0.983–1.164) was identified in 2020, compared to 1.180, 95% CI 1.098–1.269 for 2021. EMRs of small islands ranged between −25.6% and +15.6% in 2020, and between −13.0% and +20.9% in 2021, with an average gain of +0.3% (95% CI −5.3 to +5.8) for the entirety of the assessed timeframe, and no substantial differences between 2020 and 2021 (pooled estimates of −4.1%, 95% CI −12.3 to 4.1 vs. 4.6%, 95% CI −3.1 to 12.4; p = 0.143). When dealing with COVID-19 notification rates, during the first wave, parent provinces of Italian small islands exhibited substantially lower estimates than those at the national level. Even though subsequent stages of the pandemic (i.e., second, third, and fourth waves) saw a drastic increase in the number of confirmed cases and CMR, estimates from small islands remained generally lower than those from parent provinces and the national level. In regression analysis, notification rates and mortality in the parent provinces were the main effectors of EMRs in the small islands (β = 0.469 and β = 22.768, p < 0.001 and p = 0.007, respectively). Contrarily, the management of incident cases in hospital infrastructures and ICUs was characterized as a negative predictor for EMR (β = −11.208, p = 0.008, and −59.700, p = 0.003, respectively). In summary, the study suggests a potential role of small geographical and population size in strengthening the effect of restrictive measures toward countering the spread and mortality rate of COVID-19.