The inmates, both Brazilians and Paraguayans, made their getaway through a tunnel they had built from the prison in the border city of Pedro Juan Caballero.
Nearly 80 prisoners, many of them members of a big Brazilian drug and arms-trafficking gang and described as "highly dangerous," escaped Sunday from a Paraguayan prison near the border with Brazil, police said.
The inmates, both Brazilians and Paraguayans, made their getaway through a tunnel they had built from the prison in the border city of Pedro Juan Caballero, police spokeswoman Elena Andrada said.
"Our best men have gone to the border to attempt to recapture the prisoners," she said.
The number of escapees totalled 76, including 40 Brazilians and 36 Paraguans, officials said.
Justice Minister Cecilia Perez issued a sharp condemnation, telling reporters that it must have taken prisoners "several weeks" to build the tunnel, and adding, "It is evident that the staff knew nothing and did nothing."
The prison's warden was dismissed and dozens of guards were arrested.
Most of the escapees belong to a criminal gang known as First Capital Command, one of Brazil's most powerful gangs.
Andrada said the burning hulks of five vans used in the escape were found in Ponta Pora, a Brazilian city separated from Pedro Juan Caballero only by an avenue.
Pedro Juan Caballero lies about 500 kilometres (300 miles) northeast of the capital Asuncion.
The escapees included men who had taken part in a massacre last June at the San Pedro prison, Andrada said.
Perez, the justice minister, voiced "a strong suspicion that officials are involved in this corrupt scheme," adding that the escapees are considered "highly dangerous."
Andrada said the inmates had dug a tunnel "like we see in the movies, complete with internal lighting."
She said it ran from a prison bathroom, and there were only 25 metres between the tunnel and the nearest guard post.
Investigators have also found hundreds of sandbags.