Prisoners stashed 350 litres of homemade alcohol over Christmas as well as drugs worth £40,000 at a Lancashire jail, a report revealed.
HMP Garth in Leyland was described as "very unsafe" in an inspection by Her Majesty's Chief Inspector of Prisons.
Prison inspectors found "violence and drugs" dominated life at the jail with a rise in attacks on inmates and staff.
However, they also found "progress" had been made in some areas such as mental health provision and education.
The Category B men's prison was inspected in January.
Inspectors reported that the jail has a "major drug problem" with new psychoactive substances that "mimic the effects of illegal drugs such as cannabis, heroin or amphetamines".
- Levels of violence had increased "substantially", with many incidents linked to drugs, gangs and debt
- Assaults on staff had increased and much of the violence was "serious" with 66% of inmates feeling "unsafe"
- There was a leap in violence with 121 fights in six months with stab wounds, broken bones and burns
- There had been hostage-taking and barricades erected by prisoners
- 85 prisoners (in addition to sex offenders) were held separately because of fears for their safety
- One in five prisoners confessed to developing a drug problem while inside
- There had been 173 incidents of "self-harm" in six months and three suicides since the last inspection
Positive findings included prisoners being "prepared to engage positively", with a "reasonable" time spent out of their cells and good learning and skills provision.
High-risk prisoners were served well by some "very good offender management work", the report said, and public protection work was "good".
And the report said staff shortages had improved following a previous inspection in August 2014.
Peter Clarke, Chief Inspector of Prisons, said: "This was an unusual inspection of contrasting and conflicting outcomes.
"The progress in rehabilitative work was real and speaks to the potential this establishment has.
"The prison was, however, one of the most unsafe we have been to in recent times. Violence and drugs dominated the prisoner experience."
Michael Spurr, chief executive of HM Prison and Probation Service, said: "As the chief inspector points out, there is much good work being done at HMP Garth but the deterioration in safety is a serious concern and reversing this is the top priority.
"An experienced senior management team has been appointed to work alongside a new governor to help drive progress over the coming months.
"This will be supported by additional staffing and resources and an improvement plan, which is already in place to address the issues raised in the report."