|The island of Poveglia (middle ground), as seen from atop the Porta Nuova tower at the Arsenale|
The name of the island is Poveglia, it's located just a short distance west of Lido, and it's due to be auctioned off on May 6. A group of Venetians living on Giudecca, afraid that this piece of Venetian history would (as has happened far too often in recent years) be snatched up by some private interest and converted into yet another "tourist destination," decided that a group of citizens themselves should band together to make a bid on the island with the goal of developing and preserving the island for public purposes.
Or visit their Facebook page at: https://www.facebook.com/povegliapertutti
For information about the history of Poveglia, as well as its place in Venetian culture today (and potentially in the future), I'd suggest you take a look at a recent post on the blog A Garden in Venice: http://www.gardeninvenice.com/2014/04/why-do-venetians-want-to-save-poveglia.html
Anglo-American media have almost exclusively depicted Poveglia as "The World's Most Haunted Island", but A Garden in Venice emphasizes that Venetians also know it as one of the first islands in the area to be settled, whose inhabitants so vigorously contributed to the defeat of Pepin's ill-guided invasion of the lagoon in the year 809 that their representative was granted the rare privilege of kissing the doge on the lips once a year.
But if it's precisely the spooky side of Poveglia you're interested in, Robin Saikia--author of the extremely entertaining and insightful Blue Guide Travel Monograph The Venice Lido--recounts the darker events of the island's long long history and his own visit to it in his piece "A Day Trip to Hell": http://www.robinsaikia.com/p/poveglia-island-of-sadness-and-terror.html
In fact, Robin Saikia is himself part of another group planning to bid on Poveglia. Like the association Poveglia Per Tutti, Saikia's group (The Poveglia Foundation) also believes, in its own words, that the island "should not fall into the hands of speculators intent on turning (it) into a luxury hotel development. The time has come to take a stand against... entrepreneurial vandalism of this kind." You can see their proposed plans for the island at http://www.povegliafoundation.com/