The Chief Ombudsman says transgender prisoners are at risk of sexual assault under the Department of Corrections policy of housing prisoners.
Prisoners are placed according to their birth gender, unless they have completed gender reassignment surgery.
A report by the Office of the Ombudsman on the prison health system says the policy does not adequately reflect the expectation that transgender prisoners are treated with dignity.
Corrections Department acting national health manager Bronwyn Donaldson says there are only three transgender prisoners out of 8500.
She says Corrections expects all prisoners to be treated with decency and does not intend to review its policy.