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A study is under way into the possibility of housing another 240 inmates at Peterborough's mixed prison.
The privately-run prison said it was looking for ways to ease overcrowding as the country's jail population grew.
Shailesh Vara, MP for North West Cambridgeshire, said the consent of local people was important and expansion may not be the answer.
The Category B prison opened in 2005 for 840 inmates but three years later numbers have reached just under 1,000.
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Plans are at a very early stage, with no planning permissions applied for yet
The prison, run by private company Kalyx under a 25-year contract, is looking at whether it could build a new block to house more inmates.
Prison managers said they had not yet spoken to the Home Office or asked the council for planning approval but were carrying out a study to see whether it would be possible.
Mr Vara said: "The way the prison population is going at present a couple of hundred more inmates at Peterborough won't solve the problem.
"We expect the Minister for Justice to be calling again for even more places at some time the future to accommodate even more prisoners."
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