The Hamilton school made the announcement Friday, saying the money will go to projects meant to maximize mobility, slow chronic disease and tackle deadly infections.
It will also help create a website to provide Canadians with expert-vetted information on aging.
The funding comes from former Royal Bank executive Suzanne Labarge, a graduate of the university.
Labarge says aging is "a huge issue for this society" and must be addressed to meet the country's needs in coming years.
The latest census figures, released this spring, show 14.8 per cent of the country's population was 65 or older in 2011 — the year the first of the baby boom generation was turning that age.
By the time the next census is taken in 2016, Statistics Canada projects the country will be home to as many senior citizens as children.
The shift is affecting sectors ranging from health care and education to culture and recreation, and will present governments with difficult choices such as how much funding should be allocated for health care versus education.
McMaster says it's first round of research will include projects to design cars better suited to older drivers and passengers; study the dwindling of lean muscle mass with age; and look into the benefits of yoga for older women with arthritis.