When the Americans took over in the 1900s, the Bureau of Prisons was created under the Reorganization Act of 1905 (Act No. 1407 dated November 1, 1905) as an agency under the Department of Commerce and Police. It also paved the way for the re-establishment of San Ramon Prison in 1907, which was destroyed in 1898 during the Spanish-American War. It placed under the auspices of the Bureau of Prisons and started receiving prisoners from Mindanao. Before the reconstruction of San Ramon Prison and Penal Farm, the Americans established in 1904 the Luhit Penal settlement (now Iwahig Prison and Penal Farm) on a vast reservation of 28,072 hectares. It would reach a total land area of 40,000 hectares in the late 1950s. It was located on the western most part of the archipelago far from the main town to confine incorrigibles with the hope of rehabilitation. The area was expanded to 41,007 hectares by virtue of Executive Order No. 67 issued by Governor Newton Gilbert on October 15, 1912.
Other penal colonies were established during the American regime. On November 27, 1929, the Correctional Institution for Women (CIW) in Mandaluyong City was created under Act No. 3579 while the Davao Penal colony in Southern Mindanao was opened on January 21, 1932 under Act No. 3732. The CIW was