Corrections Minister Peter Malinauskas has not ruled out a further expansion of Mobilong Prison in future, beyond an extra 104 beds which were officially opened on Tuesday.
The prison's new Eyre Unit consists of 11 four-bedroom buildings, each of which includes two bathrooms and an open plan living area and has been designed to house eight prisoners.
The better-behaved members of Mobilong's population will be allowed to live in the new units under an "incentive-based regime", as the state government described it.
A new staff building containing an officers' station and interview rooms, and 16 extra beds in the Ross Unit, round off $13.5 million worth of work completed at the prison in recent months.
Despite saying there were currently more available beds than inmates in South Australia's prison system, Mr Malinauskas said "a lot more" beds would be added over the next year.
He hinted that more information about the government's plans would be forthcoming in next week's state budget.
However, he said Mobilong had not been earmarked for any extra beds "at this stage".
He refused to characterise the prison system as overcrowded.
"This new facility helps in dealing with the growing prison population we've got," he said.
"It speaks to our short to medium-term strategy to increase the capacity we've got in the system.
"Our long-term strategy is to reduce the rate of reoffending, by 10 per cent by 2020.
"The investment we've seen speaks very much about our objective of having prisoners graduate so they're better prepared (for their release) and less likely to reoffend."
He said it was "absolutely" appropriate that Mobilong continue to be classified as a medium-security prison, despite staff concerns about the type of prisoners being transferred there in recent months.
Union members’ worries about the prison led to a statewide lockdown in February.
Adelaide-based Mossop Construction and Interiors took 20 weeks to build the Eyre Unit based on plans by Grieve Gillett Andersen.
The Standard was not invited to the opening.