Abstract Background In 2014, the annual report of the Her Majesty’s Chief Inspector of Prisons (HMIP) for England and Wales raised concerns regarding New Psychoactive Substance (NPS) use in custody, specifically the consumption of synthetic cannabinoids. To date, however, the use of these substances in prison populations, and the markets that have emerged to facilitate it, have been under-researched. Methods Our research was conducted in an English adult male prison using multi-method techniques. These included: in-depth interviews and focus groups with prison staff and prisoners; observations of prisoner-led focus groups, workshops and restorative justice circles involving discussion of synthetic cannabinoid use and markets; and analysis of routinely collected prison data measuring drug seizures, incidents of violence and incidents of self-harm. Results The findings highlight: (1) the scale and nature of synthetic cannabinoid markets in a custodial setting and the motivations for establishing them; (2) the nature and motivations for synthetic cannabinoids use in prison; and (3) the impact synthetic cannabinoid markets in this setting have upon prisoners, the prison system and the wider criminal justice system. The policy implications of the stated motivations for use and reported problems are discussed in relation to both prison and community settings, and the recently implemented Psychoactive Substance Act (2016). Conclusion The paper concludes that the rise in synthetic cannabinoid use in custody and the size of the drug market are posing significant challenges to the management of offenders; including healthcare, appropriate detection techniques, license recall and sanctions for both use and supply. We argue that the primary motivation for consumption in this setting is the avoidance of drug use detection, and that this is likely to supersede other motivations for consumption in the future. We propose a revision of the use of mandatory drug tests (MDTs) both in prisons and in the management of offenders in the community.