Responding to a lawsuit about overcrowded jail conditions, Prince George's County officials have agreed to build a new detention center on county-owned land about one mile from the present facility in Upper Marlboro.

The agreement, verbally approved Tuesday by U.S. District Court Judge Frank Kauffman and signed by attorneys for both county officials and inmates who brought the lawsuit, calls for the county to build a new jail by 1985.

The site is the 160-acre Dille Farm tract, west of the county seat near Brown Station Road. The location was favored by County Executive Lawrence Hogan, but had been rejected by the County Council last year.

The council favored a 19-acre parcel adjacent to the Marlboro race track. At one time Hogan said he would support the council's choice, but he withdrew his support for that location in January, when a task force commissioned by him recommended the Dille tract.

This week's agreement also requires the county to increase its security and medical staff by July, and to reduce the prison population by 25 percent by November 1982. County Attorney Robert B. Ostrom said that if the county meets that deadline, it will be freed from liability for damages, which could have been in the millions of dollars, sought by the inmates.

"For all intents and purposes, this resolves for us the major financial liability facing the county," said Ostrom. "What we were up against was the potential for double damages--for compensation we would have to pay the inmates and on top of that the cost of building the new jail."

The class action law suit that led to the agreement was originally filed by Raymond Lattisaw, an inmate at the Prince George's Detention Center from July until October of 1978.

Writing the first draft of his action in neat penciled print, on yellow tablet paper, Lattisaw argued that the jail's severely overcrowded conditions, lack of recreational facilities and inadequate staff caused him to suffer emotional distress. His lawsuit later was expanded by the Prison Assistance Project of the Legal Aid Bureau in Baltimore to a class action on behalf of all 3,000 inmates who have been held at the jail since 1978.

The jail, designed to house 143 prisoners in single cells, now accommodates an average of 550 prisoners a day, according to jail officials, who expect the county's inmate population to reach 714 by 1990.

Attorneys for the inmates argued that the conditions at the jail violated constitutional guarantees against cruel and unusual punishment.

The agreement does not resolve Lattisaw's individual complaint, and does not become final until signed by Kauffman. A hearing on the proposed agreement, at which present and former inmates have a right to comment, is scheduled for March 16.