Hundreds of inmates were caught up in disorder after disturbances erupted across four wings of HMP Birmingham, lasting more than 12 hours.
Riot squads were deployed to the category B jail to restore order after reports of prisoners setting fire to stairwells, breaking a security chain and destroying paper records.
Specially-trained prison guards, known as “Tornado” squads from other parts of the country were backed up by around 25 riot police as they moved into the privately-run facility late on Friday.
Police had earlier closed the road and established a secure cordon around the main gate of the prison.
One prisoner is understood to have received a broken jaw and eye socket during the disturbances, while no prison staff were injured.
Broken windows and damaged walls were described as being left in the aftermath of the disruption, but sources said it had been “superficial”.
Mike Rolfe, national chairman of the Prison Officers Association, who last month protested over safety concerns, said more than 30 staff had left the prison in recent weeks and compared the trouble to the notorious Strangeways riot 26 years ago.
“This prison is a tough place to work, it serves a very big area, it serves a large, dangerous population of prisoners but it’s not unlike many other prisons up and down the country - ones that have very similar inmates,” he told BBC Radio Four’s The World Tonight.
“And we’ve been warning for a long time about the crisis in prisons and what we are seeing at Birmingham is not unique to Birmingham, but it certainly would seem that this is the most recent worst incident since the 1990 Strangeways riot.”
Mr Rolfe accused the Government of not funding the prison system properly and said such disturbances are becoming more frequent as a result.
The situation, in which keys giving access to residential prison areas were taken from an officer and inmates occupied some blocks and exercise facilities, will be investigated thoroughly, the Justice Secretary said.
Liz Truss said: “I want to pay tribute to the bravery and dedication of the prison officers who resolved this disturbance.
“I also want to give my thanks to West Midlands Police, who supported G4S and the Prison Service throughout the day, ambulance crews and the fire service who also provided assistance.
“This was a serious situation and a thorough investigation will now be carried out. Violence in our prisons will not be tolerated and those responsible will face the full force of the law.”
The city centre jail formerly known as Winson Green and run by G4S can hold up to 1,450 inmates, but it is understood around 260 prisoners were caught up in the incident.
Jerry Petherick, managing director for G4S custodial and detention, said the prisoners behind the trouble “showed a callous disregard for the safety of prisoners and staff”.
He added: “This disturbance will rightly be subject to scrutiny and we will work openly and transparently with the Ministry of Justice and other relevant authorities to understand the cause of today’s disorder.”
Former inmates at the jail where serial murderer Fred West hanged himself in 1995 have said they are not surprised at the disturbances, describing it as something that was “bound to happen”.
The latest disturbance is the third in English prisons in less than two months.
On November 6 a riot at category B Bedford Prison saw up to 200 inmates go on the rampage, flooding the jail’s gangways in chaotic scenes.
Just days earlier, on October 29, a national response unit had to be brought in to control prisoners during an incident at HMP Lewes in East Sussex.
A spokesman from the Prison Governors Association said the disturbance at the Birmingham jail “comes at a very difficult time for Noms (National Offender Management Service) on the back of recent riots and at a time when the prison estate is already bursting at the seams”.
Shadow justice secretary Richard Burgon said the disturbances at the Birmingham jail were “hugely concerning” and claimed the Justice Secretary was “failing to get this crisis under control”.
Tory chairman of the Commons Justice Committee, Robert Neill, told Channel Four News the Government had been warned by his watchdog group of MPs that a “time bomb was ticking” as prisons were in “crisis”.
When it was suggested this could be the worst prison riot in years, Mr Neill said: “Certainly looking that way, yeah, and this is a problem which has happened both in privately and publicly-run systems, so it applies across the piece.
“I think that does indicate that we have got a situation where if people are locked down 22/23 hours a day, as we have discovered, that breeds tension, that breeds violence, and, as you rightly say, we are not actually keeping prisons secure enough to stop contraband getting in.”
Labour’s shadow home secretary Diane Abbott told Channel Four News “private companies should not be involved in taking away people’s liberty. Actually, it’s clear that G4S don’t have the quality of staff to manage a crisis like this”.