An unannounced inspection of Portland YOI found staff focused on trying to provide a positive and rehabilitative experience for the young men there.
However Dame Anne Owers, chief inspector of prisons, said most of the buildings at Portland are old, and one unit is unfit for use.
Inspectors found positive efforts had been made to reduce violence and bullying and prevent self-harm and suicide but, given the population, there was a significant number of violent incidents and uses of force.
Owers said: "Managers at Portland recognised the problems of location and environment, but were nevertheless determined to create a space in which young men could have new and different opportunities.
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