The plan is to cash in on the athletics equivalent of the Wimbledon factor in the hope that the enthusiasm for tennis after the annual British Grand Slam event will be replicated several times over when the Games come to town.
But the new army of coaches will not be restricted to Olympic disciplines.
The move has been welcomed by former record-breaking athlete and chair of the Olympics organising committee, Sebastian Coe, and will be a boost for further education colleges, which are among the leading providers of sports training for the country's teenagers.
While London will enjoy some of the best athletics facilities in the world after the games are held, the trick will be to make sure aspiring sportsmen and sportswomen will be able to get the coaching they need to progress to competitive levels, as well as promoting physical fitness.
Lord Coe, who became a Tory politician after his running career was over, was one of the big names in British athletics after achieving Olympic glory during the 1980s at middle-distance.
After several years in Parliament, he returned to the athletics fold to lead the successful bid to bring the Olympics to London.
He said: "This increased investment to further the development of London's sports coaches is to be welcomed.
"The scheme is a great example of the London 2012 Olympic Games and Paralympic Games, inspiring change and beginning to create a lasting sport legacy for the city four and a half years before the events themselves commence."
Ken Livingstone, London Mayor, hopes the cash boost will help to create a lasting legacy associated with the Games, with coaches in place to train the next generation of world-class athletes.
The money will come from the Learning and Skills Council and Sport England.
Mr Livingstone said: "We are well on track to deliver a lasting sporting legacy from the 2012 Olympic Games and Paralympic Games.
"This bursary is a key part of that legacy, giving our London coaches a more affordable chance to gain the first-class skills necessary to deliver better coaching to Londoners."
Harvey Redgrave, the LSC's economic director for the Olympics, said: "We're delighted to be jointly funding this scheme, which will provide hundreds of future coaches with bursaries to pay up to two-thirds of the cost of their training.
"The development of grass-roots sports coaching is a national priority for the LSC and will be crucial in the run-up to the 2012 Games and beyond to ensure that the sporting talents of Londoners are realised."