A source said: “He is in there for his own good.
“He is extremely vulnerable and cannot be placed in a normal jail wing.
“He is currently held on the healthcare unit to protect him from other inmates. He is an easy target and may not survive if he wasn’t being permanently monitored.
“As well as that, there is a very real fear he may harm himself.
“Smith may have been found guilty of a major crime, but it is obvious he has mental health issues.”
Smith was convicted at the Old Bailey two weeks ago of planting a home-made bomb on a busy Tube train. He is to be sentenced on May 26.
Sources expect him to be referred to a high-security hospital such as Broadmoor, Berks or Rampton, Notts.
His trial heard how weapons-obsessed Smith built the deadly device at home with a £2 clock from Tesco after searching for an Al-Qaeda article called Make a bomb in the kitchen of your Mom.
He admitted a bomb hoax but a jury took just two hours to find him guilty of the more serious charge of possessing explosives with intent.
Smith – then 19 – packed a rucksack with explosives last October and headed to college in Holloway, north London.
He left the bomb, timed to go off within minutes, on the floor of a Jubilee Line train. At least 10 passengers were on the carriage at the time and one alerted the driver who mistakenly thought it was lost property.
Police interview Damon Smith, who brought explosives onto south London Tube
But he then saw wires sticking out and diverted into North Greenwich Station and called police.
If the bomb had gone off, it would have exploded just as commuters were being ordered off the platform, his trial heard.
The former altar boy, who has a form of autism, was arrested at his home in Rotherhithe, South East London.
The Ministry of Justice said: “We don’t comment on individual prisoners.”