Use of illicit drugs is associated with various poor health and social harms. We aimed to describe the mortality and return to custody of people in prison with a history of drug use once they are released into the community. We analysed a cohort of 6600 individuals with a history of drug use who were released from prisons in New South Wales, Australia, between 2008 and 2015. Within 1 year of release, 76 individuals (1.2%) died, 3200 (48.5%) returned to custody, and 3324 (50.4%) remained in the community. Calculation of indirect age standardisation revealed a standard mortality ratio of 11.2 (95% CI 8.8-13.6) and that of the 76 observed deaths, 7 were expected and 69 were excess deaths. The most prevalent cause of death was poisoning which includes drug overdose (43.4%). Logistic regression analysis revealed that increased age was a positive predictor of mortality but a negative predictor of return to custody, while male sex and Aboriginality were associated with increased odds of return to custody. These findings highlight the high burden of mortality and return to custody in this particularly vulnerable population of prison releasees and points to the need for action to address this public health crisis.