A total of £7,900 was paid out to inmates at Lincoln Prison in 2008/09
Inmates have been awarded the cash for injuries they have sustained and for periods of unlawful detention, new figures obtained by the Echo reveal.
A total of £16,365 has been spent in the last two years on compensation at the county's three prisons – HMP Lincoln, Morton Hall, near Swinderby, and North Sea Camp, near Boston.
The figures have triggered questions about whether enough is being done to keep costs down – although prison reformers say inmates deserve justice as much as anyone else.
Data released under the Freedom of Information Act shows that £7,900 was paid out in compensation at HMP Lincoln in 2008/09.
A total of £4,500 of that was paid out for injuries sustained by inmates.
A further £3,400 had to be forked out because of unlawful detention – such as prisoners being kept in the cells for longer than required.
But the figures have fallen slightly since 2007/08, when £8,465 was paid out at county prisons.
A Prison Service spokesman, who declined to be named, said: "Each litigation is dealt with on its merits and, as far as the evidence allows, all claims are robustly defended.
"The National Offender Management Service successfully defends significantly more civil claims than are settled.
"Such claims are only settled on the basis of strong legal advice from the Prison Service's appointed solicitors and/or barristers."
Prison reformers say that people with criminal convictions actually have compensation slashed because of their past behaviour.
They say the true scandal is that conditions at prisons are bad enough to generate these kind of claims.