I'm trying to find a proper source, but I believe that Mussolini's Italian team would give the fascist salute during the anthems before each game, to which the French crowds responded with boos and jeers.

When (holders) Italy met (hosts) France in the Quarter-Final, both teams traditionally wearing blue, they tossed a coin to see who would be the "away" team and the Italians duly went off to change into their second strip - only instead of the expected white, they emerged in all black, a reference to Mussolini's Blackshirt movement, and proceeded to win 3-1 and go on to win the tournament.

Photo of the Italian team in their black shirts

In a pre-tournament warm-up friendly match against England (who were at the time not members of FIFA as it was full of foreigners), the English FA actually ordered their team to join in with the Nazi salutes, trying to ensure a sympathetic reception from the crowd and build good relations with Germany.

It was done, reluctantly, and caused much controversy.

During the World Cup itself, though, Germany didn't do well and were knocked out during the first round by Switzerland.

Some more on the England-Nazi-Salute episode at http://www.historytoday.com/peter-beck/england-v-germany-1938-football-propaganda