The 21-year-old has featured regularly for the club's Under-21 side this season, but will return to his native Italy to play in Serie B for the remainder of the campaign.
The 21-year-old has featured regularly for City's Elite Development Squad this term, scoring three goals in nine Under-21 appearances.
However, he has now been farmed out to his native Italy until June 13 2013 and will hope to aid Varese's push for promotion to Serie A.
Scapuzzi has made just two Manchester City appearances since joining the club in 2011, both coming in the League Cup.
He spent the first half of last season on loan with Oldham Athletic, making 17 appearances for Paul Dickov's side - including one against Liverpool in the FA Cup.