The new facility, due to open in 2020, will offer a range of services and also feature a café, a day nursery, and a soft play centre for 0 to 11-year-olds.
It will be run from a converted building in Norwich and the development will also see the YMCA move their offices to the site.
The charity said profits from the new facility - which has been awarded a £200k grant from Norfolk County Council - will be invested back into local community provision to reduce dependence on "ever more scarce" public funding.
According to the YMCA, The Lind Trust, which owns the building - Jubilee Hall on Aylsham Road - has donated the premises as well as £500k towards the cost of refurbishment.
The YMCA is also mounting a fundraising campaign to find the remaining £800k.
The conversion will include a café. Picture: LSI Architects
Tim Sweeting, chief executive of YMCA Norfolk, said: "We are really excited to be announcing our plans to invest £2m in the future of this part of Norwich.
"This high-quality development offers a range of services that will enable us to bring local people together and develop more opportunities for them to fulfil their potential.
"As an organisation founded in Norfolk in 1856, we are committed to strengthening communities over the long-term and believe that the provision of education, employment, positive activities and leisure space will really make a difference."
John Fisher, the county council's cabinet member for children's services, said: "This investment will support the YMCA to bring this centre back into community use, providing nursery places and activities that families can enjoy together.
"It will also complement our new early childhood and family service, which aims to bring services for families with young children out into local community buildings.
"We're making a capital grant available as part of that service, so we hope to be able to support the development of more small community-led projects for families."
Lord Dannatt, president of YMCA Norfolk, said: "I am delighted that the YMCA has seized this opportunity to invest in the lives of people in the Aylsham Road area.
With the support of the Lind Trust, Norfolk County Council and trusts, foundations and generous individuals I am sure we will be able to raise all the necessary money to complete this project next year. I much look forward to the re-opening in 2020."
The Jubilee Centre was previously owned by the Royal British Legion before being purchased in 2015 by the Lind Trust.
The Jubilee Centre has since sat dormant and has reportedly been targeted by thieves and vandals.
The YMCA took responsibility for the building in November 2017 and has been working to develop a business plan that will see sustained delivery of local community services, it said.