When West Virginia became a state in 1863, it had no state prison. Prisoners were held in county jails. To alleviate crowding, Governor Boreman in 1864 ordered that convicted felons throughout the state be imprisoned in the Ohio County Jail and asked the legislature for funds to construct a state penitentiary. The legislature appropriated $50,000 in 1866, and five acres (later expanded to ten) were acquired in Moundsville for construction of the main prison. The Gothic-style West Virginia Penitentiary opened in 1867 with 840 cells for men and 32 for women. Legend has it that Moundsville was given the choice between the penitentiary and the new state university and chose the prison as the more promising institution. However, this story is likely fictional.

It is believed that Joseph Fairfax was the prison's original architect, although several others have worked on later additions. The massive stone walls, buttressed and crenelated, form an intimidating facade stretching for three city blocks opposite Moundsville's prehistoric mound. The prison was built on the 19th-century "Auburn Plan," with barred cells stacked in tiers inside the enclosing stone walls.

Prisoners manufactured brooms, whips, and men's clothing for state use until the 1930s, when production changed to soap, paint, men's clothing, and tobacco. The production of license plates, signs, and printing became the main products in the 1950s, and a vocational and educational program was established.

Overcrowding became a problem in the 20th century. In 1947, female prisoners were transferred to the new West Virginia Prison for Women in Pence Springs. The size of the Moundsville prison doubled in 1959 with the completion of a section that had been under construction for 30 years. Overcrowding persisted, however, and tension increased with the number of prisoners. Deadly riots in 1973 and 1979 prompted Ohio County Circuit Judge Arthur Recht to place the facility under judicial control. Despite efforts to improve conditions, another riot on New Year's Day 1986 led the state Supreme Court to order the penitentiary's closing. The last prisoners were transferred to the new Mount Olive Correctional Complex in Fayette County in 1995.

A variety of tours are offered at the prison, now operated by the Moundsville Economic Development Council. Mock prison riots are staged there regularly to train law enforcement officers. It also hosts tours, events, and rentals. The Moundsville Penitentiary is in the National Register of Historic Places.

Read the National Register nomination.