It was built as the Carleton County Gaol in 1862 and was connected to the Arts Courthouse which was connected to next door by a tunnel. The prisoners were kept in inhumane conditions and there would be up to 150 prisoners that had to share 60 small cells. The prison was used for men, women and children and the crimes would vary greatly from murder to being drunk and disorderly. They were never allowed to see daylight and were only allowed one meal a day. If the prisoner were sent tyo solitary confinement they were chained to the wall and only released for 15 minutes to eat a meal and use the bucket. In the mid 1960s the basement was used a quaratine for many immigrants who were feared to have scarlet fever, many people died down there and were then buried in unmarked graves. There were only 3 official hangings done at the jail yet it is rumoured that more unofficial ones were carried out by the guards. The gaol closed in 1972 as it was outdated. After the closure a bridge was built along side the grounds and some unmarked graves were found, so it may be possible that there may still bodies buried under what is now a car park. It reopened in 1973 as a hostel and remains one today with much of its originality staying.

There have been many reports of unusual happenings at the hostel including ghostly apparitions being seen, doors being slammed, women heard screaming, children crying and disembodied voiced being heard.