Police spokesman Ajith Rohana said inmates created "unrest" Sunday at Mahara prison, about 15 kilometres (10 miles) north of Colombo, and officials attempted to control the situation.
A riot at Sri Lanka's main Welikada prison in 2012 saw 27 inmates killed by police commandos, who have since been accused of execution-style murders.
Two prison officers were taken hostage, sources told the Telegraph, after inmates were enraged by the killing of the prisoner. Inmates have staged protests in recent weeks in several prisons as the number of confirmed COVID-19 positive cases spiked in the country's overcrowded jails.
The inmates "reportedly destroyed most of the property including offices inside the prison", Rohana said.
The riot at the overcrowded jail, holding almost 10,000 prisoners, began when inmates broke out of their cells to protest after the number of coronavirus infections passed 180, officials said.
Prison authorities would not say, however, whether they had taken back the whole Mahara complex.
The guards opened fire, and the clash left eight inmates dead and 59 injured, he said.
Police from other areas were also deployed to the prison to bring the situation under control.
At the same time, a prisoner was killed when he fell while trying to scale the wall of jail in central Bogambara region. Another died in March.
No fewer than 50 prison guards also tested positive.
Sujeewa Silva said her son has been detained at the facility for seven months after being arrested on drug charges.
Inmates in over-crowded prisons around the country have been demanding early release, proper testing and less congested facilities since the outbreak of the virus.
Sri Lanka has experienced an upsurge in the coronavirus since last month when two clusters - one centred at a garment factory and other at a fish market - emerged in Colombo and its suburbs.
Sri Lanka, which has been taking tough measures to contain the spread of the coronavirus, has reported 22,988 cases and 109 deaths due to the contagious virus, according to Johns Hopkins University.
Sri Lanka had reported 19 deaths out of 10,424 cases at the end of October.