Good starting tips
Place your kitchen and workshop near the road. This will allow your cooks to gather raw food faster and your workmen to deliver sheet metal to the workshop quicker.
Expand to the right is not a good option. This is due to the fact there is no way to get prisoners across the road yet (maybe they can add a bridge to cross). Also, workmen do not know how to apply for the written permission to run power cables under the road. UPDATE: As of Alpha 16 (Dec 2013) there is a new object called "Road gate", which allows you to block off a piece of the road and therefore build a secure prison that spans both sides of the motorway.
Place a locked open door behind staff doors. This allows you to lock your weak staff doors with a jail door.
A walled off cell is over rated, feel free to skip the walls and doors. (Does not work starting from Alpha 13, Cells need to be walled and with a cell door)
 Creating a Sustainable Prison (Strategy 1)
Step 1: Open Reports in the bottom right hand corner (don't hire any staff until later in the game in case it takes you a long time to build your prison. This avoids having to pay them every day even though they are not being used)
Step 2: Go to grants and accept them in order to get lots of money to build a good prison
Step 3: Complete the to do list but with caution. Try not to spend too much money on unnecessary things, for instance high quantities of grass or paving
Step 4: After building the offices place a Warden as quickly as possible and use bureaucracy in order to research Security, Maintenance, Health and financial (in this exact order)
Step 5: After finishing the research with Security place a Chief and research deployment in order to get good control of your prison, so things don't get out of hand
Step 6: As your maintainance is finished researching place a Foreman and research prison labour
Step 7: At this time most of your to do list should be complete and you should have some money left
Step 8: With your remaining money hire enough guards to protect your prison and deploy them equally throughout your prison. These extra guards should help your prison and stop riots and possible escapees. Also build a large workshop where you will place workshop machines in order to make some extra cash to spend
Step 9: Try to make your prison income sustainable and increase the size over time. You should consider hiring more guards, and building more cells for your prisoners to reside in
Step 10: Have fun doing whatever you want with your prison
- Originally written by Speedym95 - Relentlessly edited and added to by Spaceinvaders011
 Creating a Work Prison
In the game, biggest concern of the player, is probably the money, the wages and the costs. A good way to earn money, and not worry about going into minus income is creating a "Work Prison".
Process is simple. Build a big building. Don't stop at 5 x 5, if you want more work spots, you need bigger building, so at the beginning, construction that is 10 x 10, will be a good start. This will be your workshops. Continue on building all the mandatory places, like kitchen, cells, showers, etc. Get at least open 18 cells (Two cell blocks, 8 and 10 cells), and start unlocking your way to Prison labour.
- If you cut short on budget, but you still don't have your workshops ready, close them, and roll in the prisoners. they will grant you some additional money each day, that will save up for workshop equipment.
Now, when your workshops are ready, you have to get the Regime ready. 6 hours of sleep, is more than enough, but prisoners can sleep on free time too. So having no sleep time on the regime, but having free time will still make the prisoners well rested. Technically, if prisoners have 2 separate hours of eating, somewhere in the Regime, schedule like Work - Free time - Work - Free time - Work - Free time - Eat - Free time - Work etc. Can earn money, while still not making the prisoners angry.
- Note: After a week or two after the same schedule, prisoners might be angry, so removing work from schedule, and keeping it for a day or two, will keep them happy for a another week.
- Note note: Don't forget to get a few prisoners to do the laundry!
- Note note note: If you plan to bring in max security prisoners, i suggest building a separate workshop, and allowing only maximum security prisoners there, and get a one or two patrols there. This will keep them from rioting with weaker prisoners.
- Note note note note: I offered two cell blocks, because I tend to get two shipments of prisoners - the first on is always 8, and if I don't stop them coming, the second one is going to be 10 prisoners. I noted this, because I don't know if this is intended or not.
This strategy might be tricky at first, but after tweaking the prison, and the regime perfectly, you can surely do it.
 Planning ahead
A few hints about planning ahead.
- Reserve plenty of room for your kitchen and canteen. At first you won't need that much space, but fairly soon (around 30 to 40 prisoners) you will need a bigger canteen and kitchen. You can partially solve this by reserving more time to eat in the schedule, but that means less productive hours doing work. Simply reserving enough space when creating your first kitchen will help you later on.
- You can only add so many capacitors around a power station. Eventually you will need two power stations. Don't make the mistake of "hooking" them up to each other, that won't work. Instead, build two seperate power grid. The game will give the second set of power lines a different shade of green to distinguish them. You could, for example, use one power station to power the workshop, offices and kitchen, while using the other one to power the common room, cell blocks, showers etc.
- To prevent prisoners escaping early on in the game when you're busy building and there are lots of workmen going in and out, create a double set of doors between the inside of the prison and the delivery area. First build a fence around the delivery area, then three or four empty tiles, followed by another fence or prison wall. This double set of doors will prevent prisoners slipping out when workmen are offloading items.
- Plan your Laundry building in a central location in between your cell blocks. Your prisoners doing laundry need to haul the laundry around in laundry baskets and they do not move very fast doing so. If you do not, you will need a lot of prisoners doing laundry to satisfy the prisoner's needs. You can, of course, also decide to build multiple laundry area's.
- You can satisfy high needs for bladder and bowels by scheduling 1 hour of free time in between two 4-hour work shifts by placing a couple (6 to 8) of toilets close by your workshop.