Save the Children claims children are effectively being punished for their parents' crimes. It is estimated that 125,000 children have a parent in jail.
A charity report says prisoners' children do not have any special rights. A child's needs are only considered in the case of a baby or unborn baby of a female prisoner and practically no research exists into the impact on a child's education of having a parent in jail.
The report says teachers are most likely to find out that a child's parent is in jail through gossip or local newspapers.
The charity is calling on the Government to include the issues facing prisoners' children in initial teacher training and in-service training for qualified teachers.
Spokeswoman Joanne Bailey said: "A parent's imprisonment can result in big changes in a child's life. Children may feel isolated, let down, ashamed, afraid to confide in their friends for fear of being teased or bullied - all of which can have an impact on their behaviour in class and their capacity to learn."
A London primary teacher who taught a child whose father was in jail said:
"We knew when he was visiting his dad because of his difficult behaviour in class. For us his visits lasted the whole week."
A teaching pack, "Working with children of prisoners - a resource for teachers", is available from Save the Children, 17 Grove Lane, London SE5 8RD, tel 0171 703 5400, price pound;7.50.