The late Permian mass extinction was the most severe biotic crisis of the Phanerozoic, with associated environmental changes that included the expansion of hypoxic and anoxic conditions in shallow shelf settings. It has been hypothesized that wave aeration promoted oxygen transport to the seafloor providing a ‘habitable zone' in the shallowest marine environments that allowed the survival and rapid recovery of benthic invertebrates during the Early Triassic. We test this hypothesis by studying the rock and fossil records of the Lower Triassic Servino Formation, Italy. We also provide the first δ¹³C_carb isotope curve, and present new occurrence data of stratigraphically important fossils (i.e., cf. Tirolites cassianus), to improve the stratigraphic framework of the Servino Formation. The low-diversity fossil assemblages of the Servino Formation have similar compositions to other western Paleotethyan localities. Facies analysis demonstrates that benthic invertebrates were restricted to wave-aerated settings, supporting the proposed ‘habitable zone' hypothesis. However, there is no evidence for rapid recovery in the ‘habitable zone' prior to the Spathian, which may indicate additional environmental stresses. In the lower Spathian Myophoria Beds Member, an increase in taxonomic and functional richness, the appearance of stenohaline, erect taxa, significant turnover, and increased heterogeneity in the composition of benthic assemblages indicate significant benthic recovery, which is attributed to reduced environmental stress. Prior to the late Spathian “Upper Member”, bioturbation is poorly developed and restricted to only a few thin horizons, but in the “Upper Member” the intensity of bioturbation and proportion of bioturbated rock increase. This change can be attributed to climatic cooling and a related decrease in environmental stress. This upper Spathian recovery pulse can now be traced across the western Paleotethys, in both nearshore and deep offshore (below wave base) settings.