The government will issue title deeds to all prisons in a bid to secure land targeted by grabbers.
Huge sections of land owned by the Kenya Prisons Service have been hived off illegally.
A report by the Ministry of Interior on the status of prisons land will be presented to the National Land Commission (NLC) for the registration process to begin.
Among the correctional facilities that have lost land to grabbers is Yatta GK Prison in Machakos County, where officials claim only a mere 15 acres is left.
Interior Secretary Fred Matiang'i says he was informed of the "shocking news" by the facility's commandant when he made a stopover after witnessing the opening of Kenya Certificate of Primary Education (KCPE) exam containers at the Kithimani Deputy County Commissioner's office in Machakos.
"The commandant was telling me this morning that they feel like squatters on land which was essentially their own. In Kapsabet, we are almost losing everything," he said.
The CS also visited Ruiru Prisons Staff Training College (PSTC), where he inspected the ongoing construction of Magereza referral hospital and met with the college's staff.
"I normally like being very frank and levelling with the public. When you look at the list of the people who have stolen prisons land, it reads as persons who have been in charge of the prisons service before, either a minister, PS or commissioner-general. It is shameful," said Dr Matiang'i.
The Ruiru hospital, which is set for completion by June, and the National Police Referral Hospital in Mbagathi, are expected to boost healthcare service provision for security forces.
The military is constructing the two projects, which President Uhuru Kenyatta will launch.
Meanwhile, Dr Matiang'i said the government has cleared Sh3.4 billion worth of pending bills owed to prisons suppliers.
"Some of the bills that are left cannot actually be proved by those who are claiming them. This process has to be done within the law, and you have to convince the accountants that you supplied the goods for which you are claiming payments," he said.
Some claims are under investigation by the Ethics and Anti-Corruption Commission (EACC) and the Directorate of Criminal Investigations (DCI), he added.
"I have been shown a record this morning where about Sh980 million of the alleged pending bills cannot be proved by anybody. Those claiming them do not even have documents."
"This institution has come from a past of extreme abuse and we are not going to suck up to such abuses," said Dr Matiang'i.