Suicidal prisoners will be able to play games to keep them occupied
Adult prisoners in England and Wales are to be banned by the Prison Service from playing computer games rated 18.
Good behaviour will allow offenders to play other games, and those at risk of suicide will be also given access.
However, eligible inmates would have to buy consoles themselves as the new rules ban prisons from buying games or consoles with immediate effect.
The Prison Reform Trust said games were "no substitute for purposeful activity like work or education classes".
It said these were being cut back as a result of prison overcrowding.
Last year the government spent more than £10,000 on 80 PlayStations and 15 Xboxes for young offender institutions.
All prisons have been told to remove 18-rated games - not suitable for people aged under 18 - by 30 September.
Under Prison Service rules, only inmates who have reached the "enhanced" level on the Incentives and Earned Privileges (IEP) scheme should have access to games consoles.
Those are the inmates "who are demonstrably well-behaved, who commit to their sentence plan and fully comply with the prison regime", the Prison Service said.
The IEP scheme also offers other rewards such as extra visits, access to in-cell televisions and the right to wear one's own clothes.
A Prison Service spokesman said: "Access to privileges increases our ability to demonstrate to prisoners that constructive and appropriate behaviour will be positively recognised.
We should not forget the usefulness of these games to prison officers and governors keeping order in overcrowded prisons
Prison Reform Trust
"Privileges will be withdrawn immediately should the prisoner's behaviour fall below that expected of the enhanced level of the IEP scheme.
"This instruction ensures consistency across the prison estate with regards to the use of games consoles as part of the earned privileges scheme.
"Prisoners who are being managed under suicide prevention measures will be allowed access to a games console to occupy them while they are vulnerable."
The Prison Service also said "no further public money" should be spent on video games.
"For those prisoners permitted to use games consoles in cell, the cost of purchasing consoles and games will rest solely upon the prisoner and will not be met by the taxpayer," the spokesman added.
Geoff Dobson, deputy director of the Prison Reform Trust, said that because of overcrowding, prisoners were "spending more and more time in their cells doing nothing".
"I don't think anyone would have a great problem with incorporating these into a good behaviour programme, but we should not forget the usefulness of these games to prison officers and governors keeping order in overcrowded prisons," he said.
"But the bottom line is access to computer games is no substitute for purposeful activity like work or education classes, both of which are being cut back because the government is failing to tackle the underlying reasons for the rise in the prison population."
At present, video games only get a mandatory review by classifiers if they contain "human sexual activity" or "gross violence".
But in March a government-backed review said the ratings system should be overhauled to increase the number of games subject to scrutiny.