Despite planned increases in prison and jail capacities, if current trends continue in Virginia -- and there is little reason to expect otherwise -- the system will be far short of the number of beds needed to house inmates in prisons and jails in the 1990's. Although the crime rate in Virginia has remained relatively stable over the 1980's, the inmate population has grown steadily, largely due to policymakers' and decisionmakers' commitment to harsher sanctions. Recommendations for addressing prison and jail overcrowding aim to balance the punitive and rehabilitative functions of the criminal justice system. The recommended approach is to continue to incarcerate hard-core, dangerous criminals while allowing some other offenders to remain in the community under controlled supervision in corrective programs. This is a cost-effective option for reducing the bedspace shortfall while preserving public safety. Recommendations focus on system improvements, alternative sanctions, provision for secure confinement, and the reduction of recidivism. Data tables.