The Right Excellent and Famous Historye of Promos and Cassandra: Divided into Commercial Discourses, by George Whetstone, 1578.
Whetstone based his prose story on one of the based on "The Story of Epitia", from his Hecatommithi (1565); Whetstone changed the names of the major players, as did Shakespeare some three decades later.
It is unclear if Shakespeare spoke Italian or not, but it does seem likely based on how many Italian works are referenced in his canon. If this is the case, then Shakespeare likely read both versions of the story that would become Measure for Measure. Shakespeare followed Whetstone's prose story very closely, even the subplot with Mistress Overdone is taken from Whetstone.
But, of course, Shakespeare did make some changes to make his work more modern, more acceptable to Elizabethan audiences, and more starkly human. For instance, in Promos and Cassandra, Cassandra does marry Promos. Shakespeare created the character of Mariana, and, in doing so, preserves Isabella's virtue... if that's how you want to interpret the play.
It is unclear if Shakespeare spoke Italian or not, but it does seem likely based on how many Italian works are referenced in his canon. If this is the case, then Shakespeare likely read both versions of the story that would become Measure for Measure. Shakespeare followed Whetstone's prose story very closely, even the subplot with Mistress Overdone is taken from Whetstone.
But, of course, Shakespeare did make some changes to make his work more modern, more acceptable to Elizabethan audiences, and more starkly human. For instance, in Promos and Cassandra, Cassandra does marry Promos. Shakespeare created the character of Mariana, and, in doing so, preserves Isabella's virtue... if that's how you want to interpret the play.
*It's just the one, really. Two if you are in the camp that Shakespeare could read Italian.
**Yes, I'm pretty biased.
**Yes, I'm pretty biased.