The standard of care for children held in custody in Northern Ireland has been described as the "jewel in the crown" of the criminal justice system.
Inspectors say Woodlands Juvenile Justice Centre in Bangor is the envy of similar establishments in England and Wales.
But they expressed concern that 76% of children sent there are from a Catholic background.
The centre is run by the Youth Justice Agency.
It is used for children aged between 10 and 17 who are sentenced to custody.
A team from Criminal Justice Inspection, the Regulation and Quality Improvement Authority and the Education and Training Inspectorate visited the centre in November 2017.
At the time, 15 children were being held there.
Last year, the Audit Office revealed that the average cost of holding a young person at Woodlands was £324,000 a year.
The centre aims to reduce the likelihood of those held there re-offending when released.
But the audit office said the rates of re-offending have been increasing in recent years.
'The envy of neighbours'
The inspection team's report acknowledges that fact, and that the cost of running the centre is expensive, but praises the standard of care.
"The Juvenile Justice Centre is, without doubt, the jewel in the crown for the Youth Justice Agency and the Department of Justice and is a centre which is the envy of neighbouring jurisdictions," said chief inspector Brendan McGuigan.
"It is a facility which has made steady progress despite the funding and staffing reductions which have occurred."