The award is part of an extra £13m handed out by UK Sport, with half that amount coming from the Team 2012 fundraising initiative.
The extra money has been allocated according to past performance and future potential, and is a major boost for British Handball's hopes of Olympic success and their ambitions to make the sport more popular in Britain.
Paul Goodwin, chief executive of British Handball, said: "I am delighted that UK Sport has recognised the progress that Handball has continued to make. I am certain that their decision to increase our funding will be fully justified.
Incredible handball goals at the Olympics
"This funding provides us the certainty which has been lacking until now that we can fund the preparation of our senior teams for the London 2012 Olympics.
"But we also have to build a sustainable structure for Handball in Britain for the longer term and I hope that the confidence shown by UK Sport today will now encourage the public and commercial partners to really get behind Team 2012 and British Handball and support our athletes."
After being awarded £1.44m in February to cover the 2009-13 funding cycle, British Handball decided to 'front-load' all that money over the first two years to maintain the development of their squads.
And with the doubling of that award, they are assured of being able to continue their programme up to the London Olympics and into 2013.
An extra £13m has been awarded to 11 sports who received 'basic' funding awards in February, with £6.5m coming from the Team 2012 initiative, with Visa having come forward as the main sponsor.
The other £6.5m handed out has been generated by UK Sport because of a cut in the rate of inflation anticipated in the original awards.
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