Really, it could be a great look at the dark side of Federation justice, like the TOS Episode Dagger of the Mind's Eye, and a showcase of how the Federation's utopian prejudices makes it ineffective in dealing with criminals who do not share their ideals.
The vast majority of the prisoners would not be Federation citizens, but organized criminals from outside the Federation, including Orion Syndicate and Ferengi, who perform illegal activities on Federation border worlds and colonies, which while technically part of the Federation lack the resources of the Federation proper, making them hotspots for international organized criime and the only places where organized crime can be profitable in the Federation.
The location is Tantalus 8, a space station near the edge of Federation sapce. It is designed with the Federations principals of rehabilitation in mind. It is serene, tranquil. Instead of hydropinics gardens, it has several floors covered with actual soil and grass. There are holodecks with a number of pre-aproved relaxation programs and games available. It's a non-utilitarian as a spacestation can be. It's also a total failure.
The high-ranking Orion prisoners run their criminal empires from their cells, and are comfortable doing so. The Ferengis and the Orions have worked out deals granting each exclusivity in certain types of contraband, and providing a network for the illegal distribution of contraband materials. Fights tend to be broken up quickly, but rapes and murders do happen. The prisoners know all of the holes in the security systems and how to exploit them. The situation is described by the old warden as "The animals running the Zoo".
The Warden; Female, Betazed, frightening. - She's one of two audience perspective characters, but isn't exactly a protognist. She knows how to use her telepathic abilities to their fullest, and often employs them as a weapon and a tool to get what she wants. Though she is more than qualified for the position, she used blackmail to ensure her apointment so that she can prosecute personal a vendetta against one of the Orion Syndicate leaders in the prison. The series begins on her first day on the job. She quickly begins to impliment multiple harsh reforms, unpopular with both the staff and the inmates, which bring a semblance of order to the prison at the expense of many Federation ideals.
The Convict - Male human of ambiguous guilt. The other audience perspective character, a former ships counsouler he left starfleet and a convicted serial rapist who may very well be innocent, but who could also be guilty. He comes from a colony world where cloning is the perfered means of reproduction and has several identical siblings, a fact which throws all of the evidence against him into doubt. The question of his guilt or innocence is further muddied by the fact that he alternately maintains his innocence or wallows in his guilt, depending on the circumstances. To the guards, he plays the sympathetic victim, to the hardened criminals he plays a monster far more dangerous than they. When he is alone, the audience sees a third persona, his true persona, a somber defeated man trying to cling to the unlikely hope of escape from his life sentence. Neither a protagonist or an antagonist, simply an ambiguous perspective character whom the addience can root for or not dependng on their inclination.
The Enforcer; Not a human, not an Orion, but some common race - A member of the Orion Syndicate, The Enforcer is from a Federation world but rejected the ideals of the Federation in favor of adventure, capitalism, and total self-determination. His path led into the thrall of an Orion Slavegirl, who convinced him to become an executioner for the syndicate, a job he was very happy with. He is, or was, a cyborg. He once possessed a great many illegal cybernetic implants designed to help him perform his duties and slay his enemies. This inclided many implanted weapons designed to defeat security scanners. Now, his body is covered with scars where his implants have been removed by Federation doctors. The Federation staff are appaled by his self-modifications, due to their anti-transhumanist ideals, while he is equally contemptuous of the staff for their shallow self-righteousness.
The Orion Don; could work as female or male, depending on the writing - he runs the prison, possessing more power than the former warden did. The staff compromised with him because they were unable to control the prisoners witout his help, and with their compromise came a steady flow of illegal goods and the ability to control his criminal empire. The new Warden has begun to put an end to all of that and he hates her for it. The Orion Don attempts to appear as a coldhearted and ruthless businessman concerned with nothing but the bottom line, but is prone to emotional outbursts and is a very hateful person, quick to anger.
The Ferengi Leader - Self-apointed Nagus of Tantulus 8, he controls all Ferengi commerce within the prison. He has a deal with the Orion Don, allowing the Ferengis and the Orions to work together and seperately without competition or bloody wars, for the mutual benefit of both. But this truce is a fragile one.
He is on year 30 of a 50-year sentence. He is a trustee and more than slightly institutionalized. Both guards and prisoners alike respect him, and many believe that he is harmless. This is not even remotely true. Unlike the Orion Don, he truly is a cold and ruthless businessman who cares about nothing but the bottom line.
The central conflict of the story is between the two perspective characters, though it develops slowly. As the Warden's grip tightens, the Convict begins to feel a sense of responsibility towards some of the other prisoners, which leads him to oppose many of her reforms, including the use of the Neural Neutralizer on difficult prisoners. This conflict begins subtlty, with verbal sparing and non-violent resistence, but soon escalates to violence.
Secondary conflicts are between the Orions and the two perspective characters, who oppose the Orions for very different reasons. The Warden seeks personal revenge while the Orions attempt to maintain their illegal smuggling operation and their illegal communications with the outside in the face of her reforms. Meanwhile, the Convict opposes the Orions' tyranous rule and bullying of unaffiliated prisoners, which often includes beatings, murders, and rapes.
Caught in between both conflicts the staff members - mostly therapists with a few guards - and the unaffiliated prisoners, who lack the protection of the major syndicates.