The government had been given a court-ordered deadline to rehouse the 12 youths housed at Barwon Prison to a juvenile remand centre by Friday.
The deadline was imposed on Wednesday by the Court of Appeal, which upheld a finding the youths had been transferred to the prison's Grevillea unit unlawfully due to a "jurisdictional error".
By Thursday afternoon, the government gazetted the unit as a youth justice facility and remand centre.
Youth Affairs Minister Jenny Mikakos said the issue raised by the courts had been addressed by the gazettal.
"Barwon Prison's Grevillea unit is safe, secure and is functioning appropriately as a youth justice and remand centre," she said in a statement on Thursday.
Work had gone into establishing services for young people there, including in education, health and a visitor's centre, she said.
The government moved 40 teens to Barwon Prison after a youth justice centre was damaged in riots in November, ruling it unfit for purpose.
About a dozen remained in the Grevillea unit of the maximum security prison.
Lawyers for the children have said the government should have responded last week with a plan to get the children out of Barwon adult prison when the original Supreme Court ruling was made by Justice Greg Garde.
Ms Mikakos said the Parkville youth facility is undergoing urgent repairs and fortification works.
"Our hard-working staff deserve to feel safe when they go to work in our youth justice facilities and we will do what's needed to ensure that happens," she said.
