Abstract: The article substantiates the relevance of developing a mechanism for ensuring the economic security of the forestry divisions of industrial institutions of the penal system of the Russian Federation. It is shown that the need for such a mechanism is due to the combined influence of national, industry-specific, and departmental factors, including the priorities of the Economic Security Strategy of the Russian Federation, the provisions of the Concept for the Development of the Penal System until 2030, as well as the tasks of modernization and digital transformation of the forestry complex. The dual nature of the studied facility, operating at the intersection of the penitentiary and forestry systems, is revealed, which predetermines a combination of production, institutional, resource, personnel, investment, and digital risks. Based on an analysis of the scientific literature, the main areas of research on the problems of economic security of the penal system, the production sector of the penal system, and the forestry complex are systematized, existing scientific gaps are identified. The need to distinguish the forestry divisions of the penal system as an independent object of scientific analysis is substantiated. The author proposes an approach to building an economic security mechanism based on the integration of strategic, tactical, and operational management levels, as well as institutional, internal system, and market-infrastructure components. It is concluded that the implementation of the proposed mechanism will improve the sustainability of the forestry divisions of the Penal System, reduce the impact of external and internal threats, and ensure more efficient use of their production and socio-economic potential.