"There is no one demand that has been communicated," a spokeswoman for the state justice department said, adding that "we know some imates are seeking transfers."
Talks began at 8:00 am (1100 GMT) after failing to resolve the standoff Monday evening, and all 12 guards remain hostages at the facility in southern Parana state, the spokeswoman said.
The uprising began a day earlier and is the fifth in Parana's prisons in the last few weeks, as well as the 21st this year, according to the regional prison officer's union, Sindarspen.
In this uprising, one guard was hospitalized with injuries after prisoners hurled hot glue at him, the union said.
Press reports Monday said the inmates at the Guarapuava prison want better living conditions, and prisoners doing time for sexual offenses want to be transferred to other jails.
Globo News TV footage has shown three people, apparently guards, semi-naked and seated on top of a prison building. They were tied up, and watched over by inmates who covered their faces with T-shirts.
In the northern city of Sao Luis de Maranhao, the infamous penitentiary of Pedrinhas has been the scene of violence and many attempts to escape brutal conditions, while in the northern region of Amazonia two prison inmates were slain last month.
With 548,000 prisoners nationwide, Brazil's jails are bursting at the seams.
There are 274 people in prison per 100,000 residents, according to the International Centre of Penitentiary Studies and NGO Conectas says the country needs to boost capacity by 207,000 to overcome severe overcrowding.
"The Parana prison system is in major crisis," Sindarspen said in a statement.
The union added that prison officers fear for their personal safety "and we don't know if we'll make it home after our shifts."
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