Secure colleges are to be considered in a bid to improve the education received by young offenders as part of a wider shake-up of youth custody.
Most 15 to 17-year-olds in custody have been excluded from school at some point, while half of those are assessed as having the literacy levels of a seven to 11-year-old.
With a range of contracts for youth custody coming to an end shortly, Justice Secretary Chris Grayling has launched a consultation on plans to bolster the education received by young offenders.
Mr Grayling said: "I want to see new models, perhaps something like secure colleges, providing education in a period of detention, rather than detention with education as an after-thought. I want young people to get the education and skills they need to turn their backs on crime for good."
The average cost of a youth custodial place is £100,000 a year, with some as much as £200,000 or five times the cost of sending a child to a top private school.
However, 73% of young offenders who leave custody reoffend within a year, compared to 47% of adults leaving custody.
Mr Grayling went on: "We cannot go on just doing more of the same, pouring more money into a system doesn't work in the hope of a different outcome. That doesn't make any sense to the taxpayer, or to the young people who we should be trying to get back on the straight and narrow."
Learning disabilities are generally more prevalent among young people in custody, the Ministry of Justice said, and education within the youth estate is "patchy".
The green paper - Transforming Youth Custody: Putting Education at the Heart of Detention - has now been published.
Professionals from the education sector and custodial services are among those being consulted on the transformation of youth custody.