Italian-born Rosita Jelmini was a 16-year-old convent girl sitting in the bleachers when she saw Ottavio Missoni competing in the 1948 London Olympics. He placed only sixth in the 400-meter hurdles, but won Rosita; she met him later through mutual friends, and they were married five years after that. Today the silver-haired Missonis are the equals of such distinguished Italian designers as Valentino and Giorgio Armani. More than anyone else they are responsible for turning Milan into a fashion capital by pioneering a revolutionary new look in knitwear—liberally mixing stripes, dots and zigzags. "Before the Missonis," explains Ellin Saltzman, Saks Fifth Avenue's fashion director, "knits were poky and dowdy. What they have done is transform the industry."

The Missonis' sophisticated but casual clothes, often worn layer upon layer, warm the diverse likes of Marcello Mastroianni, Jill Clayburgh, Yehudi Menuhin and Lauren Bacall. Rudolf Nureyev favors their crazy-quilt cardigans, Diana Vreeland almost always sports a Missoni vest, and John Derek paid $1,000 for a gray-striped sweater-jacket. Ranging in price from $90 for a cloche to $1,200 for a knit silk evening dress, Missoni men's and women's lines are sold in 110 stores across the U.S., including Macy's, Bloomingdale's and Neiman-Marcus.

"Who says I can't use stripes with checks or that I can't put dark violet next to bright pink?" exclaims 61-year-old Ottavio (his friends call him "Tai"). In creating the multicolored fabrics that have become Missoni's trademark, he borrows freely from Guatemalan and Incan textiles. Rosita, 50, is the designer. "When we started," she says, "many people didn't understand what we were doing. But we wanted to make things we liked. I couldn't work just to make money."

Even though the falling lira shaved profits, the Missonis grossed $15 million last year. But what makes them proudest is that their three children have joined the staff of some 200 at the family factory in Sumirago, an hour northwest of Milan. Angela, 23, handles public relations while Vittorio, 27, is in management and 25-year-old Luca helps his father with designs and serves as a house model. "As kids we hung out at the factory," Vittorio recalls. "It was our playpen."

The Missoni empire got its start in 1948 when Tai decided to manufacture track suits for his Olympic teammates. The easygoing son of an Austrian countess and a Dalmatian sea captain, he was captured while serving as an infantryman at El Alamein during World War II and spent four years in a British prison camp. From track suits Tai switched to knitwear, and by 1955 the Missonis were selling to Rinascente, Italy's largest department store chain.

Their first solo show in 1967 shook the then conservative Italian fashion world and set the couple on the road to international success. Minutes before collection time at the Pitti Palace in Florence, an anxious Rosita ordered the models to take off their bras because they could be seen under her thin, clinging designs. As the mannequins swept down the runway, the spotlights pierced through the dresses. The audience applauded enthusiastically, but the show organizers did not, banning the Missonis from exhibitions for several years. The couple decamped for Milan, where they have flourished ever since. Last fall they launched their first perfume (called Missoni, of course) at a lavish soiree in New York's Metropolitan Museum. The scent retails for a heady $150 per ounce.

The pressures of running a global concern notwithstanding, the Missoni family remains close. Every noon they gather for lunch at Tai and Rosita's sprawling ranch-style house next to the factory. "I feel fortunate to be here," allows Angela. "I'm happy working for my parents—they never act like the big stars they are."