The first sod has been turned to mark the start of work on the expansion of Castlemaine's Middleton Prison.
The project will add 39 beds to the jail, allowing it to house up to 287 prisoners.
Work is due to be finished by the middle of 2022.
"This expansion will help create local jobs across Castlemaine and the Bendigo region, with local firms undertaking the project's design and construction," member for Bendigo West, Maree Edwards, said.
"I'm pleased to see work start on these improved facilities."
The state government said members of the Dja Dja Wurrung community have been involved in planning upgrades to the prison's garden.
Bendigo-based firm Fairbrother is the builder leading the expansion.
Related story: Expansion for Casltemaine's Middleton Prison
"Across the state our infrastructure projects are creating thousands of local jobs and a more secure prison system that enhances community safety," corrections minister Natalie Hutchins said.
"We are investing in key infrastructure to keep staff and the community safe, as well as investing in education and skill development to help prisoners turn their lives around."
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