John Gummer, Secretary of State for the Environment, gave the go-ahead for the development of the on-shore facilities needed to service the floating jail, HM Prison Weare, named after a local river.
Mr Gummer rejected complaints from Weymouth and Portland District Council, which had argued that the presence of the ship, a former drug rehabilitation centre on the Hudson River in New York, would make the area become "the Devil's Island of Britain, scaring away tourists and visitors".
Following an appeal by the Prison Service against a refusal of planning permission, the DoE said in a decision letter released last night that Mr Gummer was satisfied that the development would not appear out of place in a commercial working port.
"The views of it from the main tourist areas and beaches, some two miles away, will be very limited. He therefore concludes that there is no sustainable objection on grounds of visual impact."
The council argued that the ship, intended to house around 480 low-risk category C prisoners for three years would spoil views of the harbour, damage the area's reputation and deter new industry.
Jim Churchouse, chairman of the council's planning committee, said: "It's a bad decision as far as the borough is concerned. We have been hoping for a lot of investment after the Navy's departure - marinas, watersports centres and the like. We felt this development would be prejudicial."
The decision was received with relief by the Prison Service, which is facing mounting problems in accommodating inmates as the prison population hurtles towards the 60,000 maximum capacity mark.
t Penal reformers warned yesterday that the prison suicide toll will continue to rise as the jail population spirals.
The Howard League calculated that between 1990 and 1996 some 366 inmates took their own lives in prisons in England and Wales. Another 12 have already done so this year.
Last year, there were 64 suicides among an average population of 55,200. The year before the total was lower, at 60, but so was the average population, at 51,000. In 1994, the figure was 62, from a total population of 48,800.Reuse content