Fängelset ligger utanför staden.

Because fängelset is the definite singular form: the prison.

• ett fängelse = a prison
• fängelset = the prison

Swedish usually adds the definite article as a suffix at the end of the noun instead of using a separate word like English the.

You simply have to learn it as part of the noun: ett fängelse.

In Swedish, every noun has a grammatical gender:

• en nouns
• ett nouns

Here, fängelse is an ett noun, so:

• indefinite: ett fängelse
• definite: fängelset

There is not always a reliable rule from the spelling alone, so it is best to memorize the noun together with its article.

Because staden is the definite singular form of stad:

• en stad = a city
• staden = the city

Since stad is an en noun, the definite ending is -en.

So in this sentence:

• fängelset = the prison
• staden = the city

In Swedish, the is usually attached to the end of the noun.

So:

• fängelset already means the prison
• staden already means the city

There is no separate word for the here because Swedish commonly uses a suffix instead.

Because ligger is the natural verb for saying where something is located.

Ligga literally means to lie, but in Swedish it is very often used for places, buildings, towns, and other things with a fixed location.

So:

• Fängelset ligger utanför staden = the normal way to say that the prison is located outside the city

Using är is usually less natural here. Swedish often prefers:

• ligger for things that are located somewhere
• sometimes står for things standing upright
• sometimes sitter for things positioned in a certain way

For geographic or building location, ligger is extremely common.

Ligger is the present tense of ligga.

• infinitive: ligga
• present: ligger
• past: låg
• supine: legat

In Swedish, the present tense does not change for different subjects:

• jag ligger
• du ligger
• fängelset ligger
• de ligger

So there is no equivalent of English lie/lies distinction.

Utanför means outside.

In this sentence it is a preposition followed by a noun:

• utanför staden = outside the city

It can also be used on its own as an adverb:

• Han väntar utanför. = He is waiting outside.

So utanför can work both:

1. with a noun after it
2. by itself

Not necessarily.

It usually means outside the city limits or not in the city itself. It could be just beyond the edge of the city, or it could be farther away. The exact distance depends on context.

So the phrase tells you relative location, not precise distance.

This is the normal Swedish word order for a main clause:

subject + verb + adverbial/place expression

So:

• Fängelset = subject
• ligger = verb
• utanför staden = place expression

A very important Swedish rule is that in main clauses, the finite verb usually comes in second position.

That means you can also move the place expression first for emphasis, but then the verb must still stay second:

• Utanför staden ligger fängelset.

That is also correct, but it sounds more marked or literary.

A rough pronunciation is FENG-el-set.

A few details:

• ä sounds somewhat like the e in bed
• ng is like the sound in English sing
• the stress is on the first syllable: FÄNG-el-set

So a rough guide is:

• fängelset ≈ FENG-el-set

Not perfect, but close enough for a learner.

A rough pronunciation is uu-ta-NFUR or uu-ta-NFÖR, with the stress on the last syllable.

A few notes:

• the u sound in Swedish is not exactly like English oo, but oo is a useful approximation
• ä/ö-type rounded vowels in Swedish can be tricky for English speakers
• the final syllable is stressed: uta-FÖR

A rough learner-friendly version is:

• utanför ≈ oo-ta-NFUR

Yes, in informal spoken Swedish, stan is very common.

• utanför staden = standard, written, fully formal
• utanför stan = common in speech, more informal

Both mean the same thing. A learner will usually first meet staden in textbooks, but stan is very useful to recognize in real conversation.

Because when a noun appears by itself in the definite form, Swedish normally uses just the suffix:

• fängelset
• staden

You usually get an extra definite word only in certain structures, especially with adjectives:

• det stora fängelset = the big prison
• den gamla staden = the old city

So without an adjective, fängelset and staden are enough on their own.