last word, first line of second verse should be "tesor" - cut off from tesoro, literally treasure, often used as a term of endearment in Italian.

Translation of the song:

Sleep, sleep, beautiful child,
Divine King, Divine King
Fa la nanna, O dear little child,
Divine King, Divine King

Why do you cry, my treasure?
Sweet love, sweet love
Fa la Nanna, Dear Son,
So beautiful, so beautiful
Fa la nanna, O dear little child,

"fa la nanna" must be an idiomatic expression with which I'm not familiar. I ran it through several translation sites, and they could not translate the word nanna. If my memory serves, it may mean "dwarf" so the expression would literally mean "make like a dwarf". More likely, it's some kind of baby talk which probably means "cuddle down" or "go to sleep." Any real Italian speakers that can help out?