The Government is poised to close the historic Dartmoor prison as it "does not have a long-term future".
The Ministry of Justice confirmed this morning that it may not renew the lease of the Victorian jail near Princetown, which cuts a foreboding figure on the Devon landscape, but made clear it may not be for another ten years.
However, the Whitehall department made clear the "age and limitations of the prison" put its future in jeopardy.
A statement read: "The Ministry of Justice will begin discussions with the Duchy of Cornwall about the future of HMP Dartmoor, as part of the Government's ongoing plans to modernise the prison estate which is fairer on the hardworking taxpayer.
"The decision to start negotiations is not a reflection of the prison's current performance, but about its poor physical condition. The age and limitations of the prison means it does not have a long-term future in a modern, cost-effective prison system.
"Final decisions on the future of Dartmoor are a long way off as the lease has a ten-year notice period but staff will be fully supported throughout the process and kept informed of key decisions during this time."
Originally built in the 19th century to hold prisoners of the Napoleonic Wars, HMP Dartmoor now plays a vital role in the local economy and a huge area of Dartmoor depends on the prison for employment. The prison employs around 300 staff.
The Prison Reform Trust said earlier in 2010 that Dartmoor Prison should eventually be closed because it was too isolated and too old.
It was responding to a highly critical report by the Chief Inspector of Prisons.
Once holding 6,000 prisoners behind its granite walls, today around 660 criminals are incarcerated there.
The Duchy of Cornwall is the Prince of Wales's private estate, including extensive property in Cornwall and large landholdings including a third of Dartmoor and its prison.
Redevelopment of the remote moorland prison could prove tricky given the stringent planning restrictions on the national park.
Prisons Minister Jeremy Wright said: "This decision was not taken lightly and is in no way a reflection of the hard work and commitment of staff, nor of the prison's performance.
"However, we cannot shy away from the fact that funds are limited and we need to make sure we are running prisons as efficiently as we can to maximise value for the taxpayer.
"This will clearly be a difficult time for everyone involved and we will do all we can to offer support and ensure the prison continues to operate safely and securely."
The announcement came as it confirmed a further four prisons are to due close as it confirmed plans to build two new "super" jails in England and Wales.
Blundeston in Suffolk, Dorchester, in West Dorset, Northallerton in North Yorkshire and Reading prisons will close, the Ministry of Justice (MoJ) said.
The announcement was made as the MoJ confirmed plans to build a 2,000-place new prison in Wrexham, North Wales.
Justice Secretary Chris Grayling said: "This is the latest part of our plan to modernise our prisons, bring down costs, but to make sure that by the next election we still have access to more prison places than we inherited in 2010."