The criminal legal system in the USA drives an incarceration rate that is the highest on the planet, with disparities by class and race among its signature features1–3. During the first year of the coronavirus disease 2019 (COVID-19) pandemic, the number of incarcerated people in the USA decreased by at least 17%—the largest, fastest reduction in prison population in American history4. Here we ask how this reduction influenced the racial composition of US prisons and consider possible mechanisms for these dynamics. Using an original dataset curated from public sources on prison demographics across all 50 states and the District of Columbia, we show that incarcerated white people benefited disproportionately from the decrease in the US prison population and that the fraction of incarcerated Black and Latino people sharply increased. This pattern of increased racial disparity exists across prison systems in nearly every state and reverses a decade-long trend before 2020 and the onset of COVID-19, when the proportion of incarcerated white people was increasing amid declining numbers of incarcerated Black people5. Although a variety of factors underlie these trends, we find that racial inequities in average sentence length are a major contributor. Ultimately, this study reveals how disruptions caused by COVID-19 exacerbated racial inequalities in the criminal legal system, and highlights key forces that sustain mass incarceration. To advance opportunities for data-driven social science, we publicly released the data associated with this study at Zenodo6.