Hama's prison was a maximum-security facility located on a remote island in the Fire Nation, constructed specifically for detaining waterbending prisoners of the Hundred Year War. To ensure that none of the prisoners had access to water, they were suspended in cages and dry air was pumped into their cells. The guards went to extreme measures to ensure that the benders were contained by restraining their hands while they ate and drank. Any resistance during this stage was met with severe consequences.
Hama, the last waterbender of the Southern Water Tribe to be taken away by the Fire Nation, was brought here upon her capture. After staying here for most of her life, she discovered that during the full moon, her waterbending abilities improved dramatically and she was able to control the water inside other bodies, thus discovering the art of bloodbending.
After practicing the newly discovered art on the elephant rats in her cage, she successfully performed the technique on one of the guards and manipulated him into unlocking her cage. Hama then walked out of the prison as a free woman for the first time in years.
↑From older Avatar: The Last Airbender official site, originally on Nick.com (link). No longer updated.