Iraqi and US officials have found a packed interior ministry prison in Baghdad, where 625 inmates were being held in "very overcrowded" conditions.
These are not the first claims that Iraqi prisoners have been abused
Thirteen of the prisoners needed hospital treatment amid torture claims.
An Iraqi official speaking anonymously said 12 of the 13 men in hospital had suffered torture, including electric shocks and the loss of finger nails.
The conditions were found in the first inspection since some 170 detainees were found in another jail in November.
Many of those inmates were malnourished and some showed signs of torture.
The outcry over that centre, found in a bunker beneath an interior ministry building, sparked the inspection process which resulted in the second discovery.
A statement from the Iraqi human rights ministry said 56 of the inmates in the second prison had been immediately freed and 75 detainees were being transferred to a Justice Ministry prison.
It did not say why the 13 detainees needed treatment, but Iraqi officials quoted by the Washington Post and AP news agency cited the torture claims.
At least 12 had suffered "severe torture", one official said to have first-hand knowledge of the case told the Post.
"Two of them showed me their nails, and they were gone," he said.
Iraqi Prime Minister Ibrahim Jaafari said an inquiry would be held into what he termed an "unhealthy phenomenon".
"There is a committee following the case," he said. "My military adviser is touring all of Iraq's jails to know if there are such cases. I will not allow such dealing with any prisoner."
After November's discovery of the first prison, Mr Jaafari ordered an investigation into the alleged abuse of the detainees.
No report has yet been given.