Budget Travel - preauthorization ?

Can someone explain something to me, the hotel I am staying at in Italy for 2 nights has preauthorized my card for the first night, ( Its a pre pay credit card ) when you come to check out is the money they have blocked released to them and , what I mean is they dont put a block on it and then expect you to pay and then release the held amount back to you later, if you know what I mean as I will be putting only the amount for the two nights onto the card.

In theory, the actual payment transaction should release the 'preauthorised' funds, however it can take up to two weeks for the 'blocked' amount to be released.

You will need to insist that the other party contact their card clearing organisation to ensure the amount is released, preferably while you are there. It is not unknown for an orgainisation to claim they have asked for the blocked amount to be released when they have not done so
(Stand up Holiday Inn Express Southampton!)

If you only have the amount needed for pre authorisation loaded onto a pre pay card you may struggle.

No, I have put the amount on the card for the two nights that we are staying, so thats ok isn't it?

In theory, yes. In practise it depends how they actually process the payment.

I would echo the advice above that says you should ensure they release the funds. When I was a student one hotel did not do so and it took if I remember 3-4 weeks for it to be released. Being a student at the time with less than a stack of cash to throw around this had the effect of effectively freezing my bank account, which was not much fun!