Tynwald has unanimously approved spending of more than two and a half million pounds on a new custody block at police headquarters.
Home Affairs Minister Juan Watterson outlined the need for the upgrade, saying that currently people were being detained in unfit standards.
The facility dates back to 1979, with the design a decade earlier.
Mr Watterson described the blind corners, the lack of provision for disabled prisoners and the inability to meet food hygiene standards as reasons for the upgrade.
The modular construction will be largely done off Island, with a local company doing some of the ground works.
Mr Watterson said in trying times he felt he could justify the spending
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