A £400m super-prison housing 2,500 inmates is being planned for the £1bn Omega business park development at Warrington.
Owner Miller Developments is in talks with the Ministry of Justice over a deal which would see the MoJ purchase a section of the 550-acre site, close to Junction 8 of the M62 motorway.
If agreed, the plans could help revive the fortunes of the Omega development, parts of which are already behind schedule.
The scheme has so far failed to secure a single occupier, and in July the North West Development Agency told Miller that no more public money would be invested in the business park due to changes in the rationale behind the development. The move casted doubt over the feasibility of completing later stages of the plans.
Should the prisons proposal be accepted, it would be fast-tracked through an Infrastructure Planning Commission rather than decided at a planning inquiry, giving local people little chance to comment.
An MoJ consultation paper published earlier this year highlighted the need for one of the country's three planned supersize prisons to be built in the North West because of a shortage of prison places nearby.