The funds will be used to support a network of development officers around the country who work with clubs, schools and community groups.
It brings to almost £6 million the total that has been invested in rugby through the CashBack for Communities programme since 2008.
Over that time, the number of registered rugby players in clubs and schools has more than doubled to about 40,000.
Ayrshire has particularly benefited, with around 3,600 young people playing the game, and Justice Secretary Kenny MacAskill was in Kilmarnock to watch 500 pupils taking part in a rugby tournament.
The CashBack for Communities programme takes the gains of crime, recovered through the Proceeds of Crime Act 2002, and invests them into community programmes, facilities and activities largely for young people at risk of turning to crime and anti-social behaviour as a way of life.
Mr MacAskill said: "The money is taken from those who have harmed our communities where we've confiscated assets and taken stuff from them and we're now putting it back in to make Scotland and our communities better places.
"What we see with the rugby is youngsters improving themselves, they're having fun, feeling better about themselves, getting healthier and I've heard from teachers that it improves their behaviour in school."