The three-judge panel called the severely overcrowded conditions in the state's 33 prisons "appalling" and unconstitutional. Attorney General Jerry Brown wants to appeal the ruling.
"Government is established to protect the safety and security of its citizens, and these wholesale releases are totally incompatible with that," said Brown.
The ruling is a victory for inmates who began their legal battle 14 years ago, claiming overcrowding was cruel and unusual punishment. The attorney representing the inmates thinks the money that's spent on housing prisoners can now be spent on local rehab programs.
"If this is done properly, which I believe it can be, the public will actually be safer with these prisoners out," said Don Specter, the attorney for California inmates.
The release order is not much of a surprise since lawmakers have known for years such an order was a possibility. However, they bickered endlessly over how to improve conditions.
While the order stops short of an edict for immediate release, the judges want an inmate reduction plan by the middle of next month.
"We don't want to be in a position where the courts say, 'You've had long enough, open the gates and let them go,'" said Matthew Cate, California Corrections Secretary.
To ease the budget crisis, Governor Schwarzenegger already has a plan to reduce the inmate population by some 27,000 through changes in the parole system for low level offenders. However, that still leaves some 20,000 prisoners that must be released, according to Thursday's ruling.
"To get to the 44,000 or 45,000, you are going to have to release dangerous criminals back into society," said Christine Ward, Crime Victims Action Alliance.
State figures show 59 percent of those released from prison are back within three years.