WellingboroughPrison will close by the end of the year.
Closing the Category C prison will save the prison service £10m but will result in the loss of almost 600 prison places.
It is believed staff currently at the prison will be moved to other jails and there will be no compulsory redundancies.
Making the announcement Justice secretary Kenneth Clarke said:“Closing outdated and expensive prisons is an important step in our strategy to deliver a fit for purpose. modern custodial estate that can provide high quality, cost effective and secure regimes that protect the public and reform prisoners.
“Closing this one prison alone will save millions of pounds for the taxpayer.”