Plans have been announced to expand the number of prisoners at Wales' only private jail by more than a third.
The Home Office says it needs 10,000 extra prison places
A block housing up to 450 inmates would be built at Parc Prison near Bridgend, creating 150 jobs.
The proposal requires the go-ahead from Bridgend council and the Home Office and it would be able to accommodate more than 1,500 prisoners.
The Home Office says it needs 10,000 extra prison places in Wales and England by 2012.
Parc prison, run by Group 4 Securicor, currently provides over 1,000 places for adults, young offenders and non-convicted juveniles.
The company is putting together its proposal for a new block within the existing walls of the jail which celebrates its tenth anniversary in November.
The planning application is to be submitted to Bridgend Council at the end of the month.
If approval is given, a final decision will then be made by the Home Office.
Group 4 Securicor has set a target date for the new block to be opened in 2009.
However, the Probation Service in Wales has said it is concerned that the costs for the expansion could divert resources away from other areas.
The Chief Probation Officer for south Wales, Ian Lankshear, has suggested the issue of prison population should be debated.
"It raises something more fundamental which is about deciding whether we want to continue moving in the direction of a rise in prison population," he said.
Around 150 jobs could be created with the expansion
"There are other ways to deal with offenders who don't need to be incarcerated for the immediate protection of the public."
Local residents, who fought a high profile campaign against the creation of the jail, say they have no objection in principle, but have called for some localised road improvements.
In May 2006 a penal reform charity criticised overcrowding in Wales' five prisons.
According to the campaign group Howard League for Penal Reform Welsh jails were over official capacity.
During May 2006 Swansea jail held 424 inmates, despite the accommodation level being 248.
Usk Prison housed 238 men even though it had space for 150 men Cardiff had 752 inmates, despite having room for only 524.
Parc had 1007 prisoners, although its maximum accommodation figure was 839.
At that time Prescoed at Pontypool was the Welsh prison facing the least pressure with 169 inmates in a prison designed for 160.