The justice secretary has said fresh prison reforms will cut reoffending rates, reduce drug use in jails and give more skills to offenders.
Mr Straw said criminals needed to show certain standards of behaviour
Jack Straw said he wanted to press ahead with three huge "Titan" prisons - one each in south-east England, the north-west and the West Midlands.
Criminals would also be encouraged to go on behaviour programmes, he said.
But the Liberal Democrats claimed better drugs rehabilitation and mental health provision were "years" overdue.
It comes as it emerged that 16,197 prisoners in England and Wales were released early due to jail overcrowding since June - under an emergency scheme which releases people up to 18 days before their sentences end.
On Wednesday, Mr Straw suggested that the "Titan" jails might not go ahead because the government did not have planning permission for them.
"We're not going to have large warehouses as they have in the United States and indeed France," he told BBC Radio 4's Today programme, prompting suggestions of a government U-turn.
But later Prime Minister Gordon Brown said they would be built, after consultation.
Mr Straw said in a written statement that the government's plans signalled "a major drive to overcome some of the barriers to the rehabilitation of offenders".
He said: "These measures are focused on tackling drug use among offenders and providing opportunities for offenders to learn the new skills which might help them to a life away from crime outside prison."
A project to train prisoners in installing voice and data cabling was to begin at Wandsworth Prison in south-west London involving companies including Cisco, Bovis Lend Lease and Panduit, Mr Straw said.
He said "enhanced vocational training" would help prisoners turn away from crime and give them back "stability, discipline and responsibility".
Ministers will consider further measures to reduce the drug flow into prisons, such as reviewing the way visits are conducted, more rigorous searches and an increase in sniffer dogs.
And more of those serving sentences of less than a year would be given "community-based punishments" rather than spells in prison, combining unpaid work, behaviour programmes and electronic monitoring, all of which would be intensively supervised.
Mr Straw said there would also be "a competition for a new prison ship" and added that a consultation had begun for a new jail at the former RAF Coltishall airfield in Norfolk.
But the Liberal Democrats' justice spokesman, David Heath, insisted that "extra investment in drugs rehabilitation and mental health provision should have been introduced years ago".
"The flip-flopping on the so-called 'Titan' prisons betrays the lack of forward planning in the department, he said.
Labour had provided 20,000 more prison places, Mr Straw said
"This is a government desperate to find a way out of a crisis of its own making. I suppose that we should be grateful that at least some of the ideas Jack Straw is grasping at have been Liberal Democrat policies over many years, but I hope they are given the resources to make them work."
And Jackie Worrall of crime reduction charity Nacro said the government's proposals were "certainly not new".
"Opportunities for tackling drug addiction and making links with employers on the outside have existed for some time, but long-term overcrowding has severely hampered access to the programmes," she added.
Chairman of the Prison Officers' Association Colin Moses said the whole prison system was in crisis and while Mr Straw's statement was a "step in the right direction" - more money was needed to deliver results.
He said "efficiency savings" imposed on the prison service meant staff cuts, prisoners held in their cells for longer and behaviour programmes cancelled.
And Juliet Lyon, director of the Prison Reform Trust, said it was right to focus on getting prisoners a job to help them lead law-abiding lives.
But she added: "The key to success in bringing down re-offending rates will be whether ministers are willing and able to reduce the enormous number of people in prison who do not need to be there."
Last year the prison population hit a record high of more than 81,000, and that figure is predicted to carry on growing.
There are currently 1,200 spare places, with an additional 1,000 coming on stream in April and 2,600 during 2008.