The compensation is believed to be the largest payout for such a case and has been handed to a Congolese family after the Home Office accepted their detention was unlawful.
The damages were agreed at the High Court after the family argued they had been left traumatised after immigration officials raided their home and took them to Yarlswood Detention Centre for 57 days in 2006.
The case centred, in particular, on the couple’s eight-year-old daughter who had psychological problems.
The family’s barrister, Stephanie Harrison, told Mr Justice Mackay that the Home Office now conceded that their detention was “unlawful from the outset”.
The mother arrived in the UK with her eldest daughter in 2002 but had her claim for asylum rejected three years later. The father arrived later but had his claim for asylum also turned down in 2005.
The couple had another daughter while here and put in a third claim as husband and wife which was refused in 2006.
Although the mother was still appealing her individual refusal in June of that year, she, her husband, and daughters, aged just eight and one, were woken in the early hours at their home in Dudley, West Midlands, and taken to Yarlswood Detention Centre, where they were held for 57 days.
After they were released, the Home Secretary again signed a removal order against them and another “dawn raid” followed in September the same year. This time the family was held for three days.
Miss Harrison said the Home Office had failed to abide by “its own stated policy” on asylum seekers, or take account of the impact of the raids on the children.
She said the entire family had been traumatised by the raids and detention.
The Home Office agreed to pay £46,500 damages to the father, £39,000 to his wife, £45,000 to the elder girl and £19,500 to the baby girl, who was born in the UK.
Mr Justice MacKay, who ordered that the family should not be identified, said: “This is a fair and reasonable settlement for the wrongs that were done to them.”
A UK Border Agency spokesman said: “The UKBA is actively working on alternatives to detaining families with children.
“During detention or removal from the UK, we take the welfare of families with children extremely seriously.
“Officers involved in family removals receive thorough training in procedures to minimise the distress caused. All members of the family are treated as sensitively as possible.”
Children’s Commissioner for England Sir Al Aynsley-Green said: “I am particularly pleased that the two children have also been awarded compensation by the court. It goes some way to righting this wrong.
“We are working with the UKBA to secure alternatives to detention and improvements to the asylum and immigration system for children. I will be publishing a report with recommendations and an action plan shortly.”