Prison officer Emma Blake, of Barnsley Street, Wigan, was due to face a trial at Preston Crown Court this week.
It was alleged the blonde 28-year-old worker effectively facilitated a romantic relationship between an inmate and an English teacher.
But on what should have been the first day of her trial, the Crown Prosecution Service told judge Sara Dodd it was not proceeding with the case against Ms Blake.
Her colleague Jennifer Forshaw, 28, who worked as a teacher at HMP Wymott in Leyland, has already pleaded guilty to committing misconduct in a public office by entering into a romantic relationship with an inmate there.
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The court heard the offences are alleged to have been committed between December 1, 2015 and June 10, 2016.
It is alleged Forshaw communicated with her lover by a mobile phone that she knew he should not have had inside the prison.
The brunette, also of Barnsley Street, Wigan, will be sentenced on a date to be set.