Dorchester prison has been put on the market by property developer City & Country.
The company admitted last August that it was struggling to find the cash for the plan to convert the site into homes, after buying a portfolio of former prisons from the government.
The 4.8-acre site has planning permission for the conversion of the existing prison buildings to provide 60 units, and the creation of 125 new-build apartments and houses in the grounds.
The proposed development became mired in controversy from the outset, including the refusal by City & Country to include any element of social housing, a decision it won on appeal.
There was also a row over what would happen to the bodies of executed inmates, believed to include that of Martha Brown, whose hanging in 1856 was witnessed by Thomas Hardy and said to have inspired Tess of the D’Urbervilles.
A City & Country spokesman said, “We are exploring a range of options to transform Dorchester prison. Should there be an appropriate alternative approach put forward by others we would consider this.”