By 1877 prison reform was again on the agenda and the Government passed a further Prisons Act which effectively nationalised some 31 local prisons, taking them out of the control of local authorities in 1878. Although Scarborough had the opportunity to purchase the prison from the Government for just under £3,500 ( plus a £10,000 mortgage) the opportunity was declined and the prison closed. Prisons were thenceforth transferred to York or Hull.

In 1879 there was a petition to re-open the prison, supporters citing the fact that in that year it had cost some £150 to transport some 286 prisoners to York by rail plus the cost of manpower for transport etc but the pleas fell on deaf ears. The prison never clanged its doors in anger again.