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According to the Sun, course candidates included the al-Qaida terrorist Zia Ul Haq, who had plotted bomb attacks on London.
Straw said: "As soon as I heard about the course at HMP Whitemoor, I instructed that it must be immediately cancelled. It is totally unacceptable. Senior managers in the Prison Service, who were also unaware of the course, take the same view as me.
"Prisons should be places of punishment and reform, and providing educational, training and constructive pursuits is an essential part of this. But the types of courses available - and the manner in which they are delivered - must be appropriate in every prison."
He added: "What happens inside the prison gates has ramifications outside, on victims and their families and on taxpayers. There is a crucial test: can the recreational, social and educational classes paid for out of taxpayers' money be justified to the community?"
The eight-day workshop for 18 prisoners was run by the Comedy School of London and cost Whitemoor about £8,000, according to reports.
Most inmates in UK prisons have access to educational courses. Many of these are designed to help inmates return to employment when they leave prison.
Comedy classes, which organisers say foster team work and communication skills, have been available since 1998.
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