The lawsuit, filed Monday in San Diego, claims the measure violates early-release restrictions in Proposition 9, which voters approved in 2008 to protect victims' rights.
The inmate release law that took effect in January grants reduced prison terms to low-risk felons if they take job classes or earn high school equivalency diplomas. It's designed to save $500 million and ease prison overcrowding by freeing as many as 6,500 inmates.
The lawsuit was filed by Crime Victims United of California, which lost an earlier lawsuit in Placer County. The Association of Orange County Deputy Sheriffs filed a similar lawsuit in that county but withdrew it this month.