Whanganui Prison is being earmarked for expansion.
The Corrections Department has confirmed that it is "consulting" on a proposal to add another 32 beds to the prison complex at Kaitoke.
The confirmation has come from Jeremy Lightfoot, Department of Corrections national commissioner, who told the Chronicle the additional beds would raise the total number to 561.
"There is no final decision, however, as the consultation process is still under way," Mr Lightfoot said.
In August 2015 the country's prison population topped 9000 for the first time. Since then it has continued to rise fairly steadily, reaching 9436 last month, an all-time high for the department.
As at Tuesday this week the number was 9325.
Mr Lightfoot said with the prison population increasing, Corrections was looking at options for "maximising capacity" at prison sites.
He said prisoner numbers were dependent on factors outside the department's control, including legislative changes, judicial decisions, policing trends and crime levels. He said the current spike in inmate numbers was due to more people being held in prison on remand than was forecast.
"Legislative changes have also meant prisoners serve more of their sentence in prison, and there has been an increase in people serving longer sentences for more serious crimes."
Mr Lightfoot said the department had been managing to work within existing prison capacity by making the most of existing cell numbers, deferring planned maintenance work, and reconfiguring prison units.
But he said these initiatives were not sufficient to manage future increases.
The latest forecast predicts that increasing volumes will continue for the foreseeable future, rising as high as 10,000 by 2017.
"Given the long lead-in times required to add new capacity, we need to look at options and plan ahead now," Mr Lightfoot said.