Since 2012, all under-18 offenders have been accommodated separately from adults at the Woodlands Juvenile Justice Centre in Bangor, County Down.
However, the CJI said the impact of older children in the centre was "testing the resilience of staff".
It said the "existing regime" needed redesigned to suit 16 and 17-year-olds.
The Chief Inspector of Criminal Justice in Northern Ireland, Brendan McGuigan, said the centre was facing "significant challenges" in how it addresses the needs of young offenders.
"Woodlands Juvenile Justice Centre accommodates some of the most difficult and disturbed children in our society, and in doing so, prevents them from causing mayhem in their communities and in the residential care system," he said.
"It's great we're not keeping under 18-year-olds anywhere else but in the juvenile centre, but some of those - and the increasing number of 17-year-olds - are proving more of a challenge for staff within the centre.
"What we're saying is that you probably need to think about the regime you're currently offering so you can build in a resilience and be able to deal with these older children."
The CJI also called for the Youth Justice Agency, which operates the juvenile justice centre, to work to reduce "inappropriate use" of the facility.
Mr McGuigan said: "Inspectors accept that the juvenile justice centre has and can provide stability in times of crisis, but committing a child to custody should be an action of last resort.
"Significant challenges lie ahead for the centre. We believe maintaining strong leadership is essential to addressing these challenges and meet the needs of a changing population."
The Justice Minister David Ford said the centre was continuing to make progress and that he was pleased that children were receiving "high levels of care and support" during their time in Woodlands.
Changes are needed into how children in prison in Northern Ireland are cared for, a report by the Criminal Justice Inspectorate (CJI) has found.