Citing declining inmate numbers and an Inspector General's report showing private institutions experience more security incidents per capita than government-run prisons, Yates directed the Bureau of Prisons to decline to renew private contracts, or "substantially reduce" their scope.
In his letter to the Bureau of Prisons, however, Sessions claimed Yates' guidance "changed long-standing policy and practice, and impaired the Bureau's ability to meet the future needs of the federal correctional system," and directed officials to "return to its previous approach."
According to the Federal Bureau of Prisons, just 21,366, or about 12 percent, of the nation's 189,000-plus federal inmates are housed in privately managed facilities. (Of course, the vast majority of incarcerated persons in the U.S. are held in state facilities, according to the Bureau of Justice Statistics.) The Justice Department told ABC News the Bureau of Prisons currently has 12 private prison contracts.
ABC News' Jack Date and Mike Levine contributed to this report.