The 41-year-old woman, who cannot be named for legal reasons, has pleaded guilty to procuring unlawful sexual intercourse with a person under 17, being a commercial operator of a sexual services business and receiving a fee derived from sexual services provided by a child in a sexual services business.

The court heard the woman, her daughter and her partner, Gary John Devine, 51, of Glenorchy, decided the girl would become a prostitute to make money after the woman complained about losing $20 from her wallet.

The next day the accused paid for the first of six advertisements in The Mercury newspaper, which described the girl as "Angela 18 years old and new in town".

The woman booked a room at the Hobart Midcity Hotel for two nights for her daughter to work, leaving her under the supervision of Devine, who is serving a 10-year jail term after admitting his role in the matter.

Devine would knock on the door to advise the men when their time was up.

He drank the contents of the mini-bar while waiting - a fact the mother later complained about because she could not reclaim the room deposit.

Prosecutor Daryl Coates told the court the woman's 15-year- old daughter asked her mother about her younger sister's whereabouts.

According to Mr Coates, the woman replied: "I can't say, I'll get into trouble. No one is supposed to know."

The court heard the woman then rang her daughter in the hotel room and asked if she was having fun and if it was a "different experience".

The woman later told her eldest daughter that it didn't matter where the 12-year-old was because "we're going to get money out of it and we're going to get Commodores - one for you and one for (the 12-year-old girl)".

After being pushed further by the 15-year-old, Mr Coates said the woman confessed "she's laying on her back working, making money" and that it was OK because the money would help pay her mortgage and fix a car window.

Proceeds from the sex business were split. Devine received about $100 a day, the mother $400 a day and the rest was used to buy drugs.

The prostitution continued at Devine's Glenorchy unit, with the mother supplying lubricant and condoms for the girl.

It is estimated that she slept with more than 100 men.

The girl and another younger sister were under care and protection orders at the time of the offences, making them wards of the state.

Mr Coates said the girl had contracted sexually transmitted diseases, including genital warts and chlamydia.

The court heard that in late September it was decided that it was too risky for the prostitution operation to continue.

Soon after, Child Protection Services contacted Tasmania Police, who initiated an investigation.

The court heard the woman initially denied knowledge of the business in two separate police interviews.

Mr Coates said the woman had shown little remorse by repeatedly lying to police and persuading her daughters to lie for her.

He said there was a "marked difference" between her and Devine's breach of trust.

The woman's defence lawyer, Rochelle Mainwaring, said the crime was horrendous and that nothing excused her client's behaviour.

But Ms Mainwaring said drug addiction had dominated the woman's life.

She said the woman had been sexually abused as a child and had distorted views of her daughters as adults.

Ms Mainwaring said the 12-year-old was sexually active before she was prostituted.

The woman sobbed in the dock throughout the hearing as the details of her crimes were read to the court.

Ms Mainwaring said her client had been segregated from other prisoners and that prison officers confined all other prisoners when the woman went out for exercise.

"She spends most of the time in her cell and eats in her cell, which is unusual," Ms Mainwaring said.

Justice Peter Evans will sentence the woman on Friday.