A new wing opened at the Provincial Correctional Centre in Sleepy Hollow, P.E.I., on Tuesday.
The wing adds 48 beds to the jail, which had 95 beds previously and had been overcrowded.
The facility, located just north of Charlottetown, was often about 30 inmates over-capacity, prison officials said.
The addition is for low-risk offenders serving intermittent or weekend sentences.
An additional eight guards and support staff were hired for the extension, which cost more than $3 million to build.
The first inmates will serve time there this weekend.
A separate entrance will keep the weekend inmates away from the main jail population and make it easier for staff to keep drugs and tobacco out.
The P.E.I. Union of Public Sector Employees, which represents most of the correctional officers at the jail, complained about overcrowding for years.