The Irish Prison Service had originally identified a different site for the relocation of Mountjoy Prison to the one announced on Wednesday.
The Irish Times has learned that officials were in detailed negotiations on another site, close to the proposed N2, and had almost finalised a deal. However, the landowner received a higher offer and the deal fell through.
It is thought the land in question was three miles to the south of the site announced on Wednesday and had been rezoned recently.
The Prison Service sought yesterday to allay the fears of people living in the north Dublin area over its plans to relocate Mountjoy.
As people from the Kilsallaghan area, south of Ashbourne, prepared for a public meeting last night, the director-general of the Prison Service, Mr Brian Purcell, sent hand-delivered letters to local people, assuring them that they would be fully consulted about plans for the site.
The Prison Service also wrote to the manager of Fingal County Council, Mr John Tierney, giving him a brief outline of the proposals.
The letters failed to dissipate the anger of many residents, who had heard via radio and television that a prison was planned less than 500 metres from where they live.
Mr Purcell wrote: "The purpose of this letter is to assure you that the highest priority will be given to allaying, insofar as is possible, the genuine concerns of local residents in relation to the development.
"I will in the coming weeks be putting in place a formal mechanism for consulting with you about our proposals, and in this context we hope to arrange an information meeting for locals in the very near future."
Mr Tom Kelleher, a Labour Party councillor, said that the letters provided no assurances, given that the proposals to build did not require planning permission.
"This area has been selected for no good reason other than that the land was available," he said. "It just doesn't stack up."
The landowner, Mr Richard Lynam, who sold his 150-acre farm to the State for €29.9 million, could not be contacted yesterday. The gates at the entrance to his home, Thornton House, were closed and padlocked with a heavy chain and his telephone was not being answered.
Mr Lynam has not been seen in the area since Wednesday afternoon, when he delivered a small number of letters locally.
These letters stated that the family, which had been in the area for the past 60 years, had had no plans to sell the farm and that it had not been on the books of any auctioneer.
However, they had been approached about the site a few months ago by representatives of the Government and, because of the size of the offer, the decision to sell, while regrettable, had been "inevitable".
Yesterday afternoon, locals in Maye's shop said that people from the area were in shock, as there had been no indication of any proposals for the site.
Mr Frederick van Daele, the proprietor of a chocolate shop, Chez Emily, whose premises is located about 500 metres from the Lynams' house, said he had heard the news from a postman.
"He came in and said 'Did you hear about the new neighbours'? I could not believe it. I thought he was just joking."
Mr van Daele said the local people feared that they would not be able to do anything to prevent the development.
"But we will have to fight, and I will fight every single brick of it," he said.