The Gaol was initially founded with rehabilitation as a core principle, housing convicts sentenced to transportation from England between 1850 and 1868. Built in 1852 as a convict hiring depot, it included quarters for warders and cell blocks for imperial convicts brought to Western Australia as skilled laborers.

Convicts who earned their ticket of leave were employed by free settlers for various jobs. After the hiring depot closed in 1872, the Gaol was expanded in 1873 to serve as a public prison, adding women's cells, a hall and additional warden's quarters. It was ultimately used as a police lockup during the Great Depression in the 1930s.