The HM Chief Inspectors of Prisons report also criticised a "confusing array" of risk-management systems.
Safeguarding arrangements were generally effective, but the child protection and anti-bullying procedures at Wetherby YOI were inadequate, while the use of force was relatively high, it said.
However, despite "extensive and disruptive" building work that had led to crowding at the time of research, the centre - which houses both sentenced and unsentenced young men aged 15 to 18 - was performing "reasonably well" in most areas and was essentially a safe place, the report concluded.
Chief inspector Anne Owers said: "Wetherby remained a reasonably safe, respectful and purposeful place, with a commendably positive and child-centred approach, focused on reintegrating young people back into society. Inevitably, there were areas that require further improvement, but, once the current refurbishment and expansion works are completed, Wetherby should be able to tackle these effectively."
Phil Wheatley, director general of the National Offender Management Service, said: "The chief inspector rightly recognises the commendable work going on at Wetherby, creating a positive and safe environment which challenges the young people to engage in education and training and to address their offending behaviour.
"The challenges encountered during the building work have been well managed, and staff are to be congratulated for maintaining safety and a purposeful regime during this time."
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Yorkshire young offender institution faces criticisms
A Yorkshire young offender institution has been criticised for routine strip-searching of young people on arrival but judged "reasonably safe" by a government inspection body.