Carandiru quickly became renowned for its severe overcrowding issues and poor conditions. During the time when 8,000 inmates resided in the facility, there were only 1000 guards who tried unsuccessfully to maintain control and order. Eventually, the gangs inside the prison took over control of the cell blocks, and the guards and medical staff became reluctant to enter.

This meant that inmates medical conditions were left untreated, and many died from infections which could have been cured with a simple dose of antibiotics. Malnutrition and starvation was also commonplace within the walls at Carandiru, and many experts suspect that the gangs were selling food to fellow inmates, causing them to starve if they had no money.

A severe AIDS epidemic ran through the prison, and in1989, Brazilian physician Drauzio Varella volunteered to work there unpaid in an attempt to address it. He spent 12 years as a physician at Carandiru, and wrote a book entitled 'Estação Carandiru' (Carandiru Station) which described his experiences during that time.

The book described in detail the horrors which were commonplace in the prison, and the inhumane conditions in which the inmates were forced to live for years. The book became a Brazilian best seller, and was quickly turned into the film 'Carandiru.'

The Carandiru Massacre took place on 2^nd October 1992, when the military police stormed the building following reports of a prison riot. During the riot, the police made very little effort to negotiate with the unruly prisoners, who could no longer tolerate the dire conditions in which they were forced to live.

The Polícia Militar do Estado de São Paulo were called by the police, who entered the prison and shot and killed over a hundred prisoners. A total of 111 prisoners died that day, 102 from military police gunshots, and nine from stab wounds, which allegedly occurred during the initial riot. Survivors claim that they witnessed the military police fire at inmates who had already surrendered or were hiding in their cells.

Once the news of the massacre hit the public, an uproar occurred, in both Brazil and the rest of the world. The incident was (and remains to be) considered to be one of the worst civil rights violations in the history of Brazil and led to the inevitable trials of the commanding officer of the operation and 53 of his officers.  Colonel Ubiratan Guimarães, the commanding officer was sentenced to 632 years in prison at his trial. However, this was overturned after several mistrials as he was “only following orders” and he was set free in 2006, only to be assassinated that same year.

The trials for the other officers began in April 2013, when 23  policemen  were each sentenced to 156 years in prison for their role in the massacre. Later that year in August, a further 25 officers were sentenced to 624 years imprisonment each for the deaths of 52 inmates. The latest trial to be held was in April 2014, when another 15 officers were sentenced to 48 years each for their role in the bloodiest massacre to take place in a Brazilian prison.

Aftermath

As a result of the massacre, and increasingly bad publicity, the prison was closed in 2002 and demolished. One block was left remaining, and is now used as a museum which is open to the public. On the rest of the former prison site lays the Parque da Juventude.

It is also reported that one of Brazil's most notorious gangs, Primeiro Comando da Capital (PCC) was formed as a direct response to the treatment the inmates received during the massacre. They also claim the responsibility for the death of prison director José Ismael Pedrosa.

Demolition of the former complex began on December 8, 2002, with the manual removal of pavilions 6, 8, and 9, marking the symbolic end of a chapter in São Paulo’s prison system. In 2003, the area was revitalized and converted into Parque da Juventude, a 240‑thousand‑square‑meter public space.

The park includes the Biblioteca de São Paulo (BSP) and various sports and cultural facilities, among them the Parque da Juventude State Technical School, which offers courses in nursing, computer science, music, and singing. The site now serves as a space of renewal, reflection, and community development.