Williams made the donation to Auckland's Starship Hospital to help fund the rebuilding and expansion of its oncology and hematology wards.
The contribution was made through the Steve Williams Foundation, set up in 2001, which has traditionally supported junior golf and motor racing projects.
Williams announced the donation to hospital staff, patients and their families during a holiday in New Zealand.
'My wife Kirsty and I decided we wanted the foundation to support another area that was in real need, where we could make a big difference,' Williams said.
'We talked to the Starship Foundation and were immediately sold on the Starship cancer ward.
'We spent part of a day at Starship and met many families in the cancer ward and it was impossible not to get emotional. I couldn't imagine what it would be like to have a child diagnosed with cancer and have to go through the treatment process.'
The hospital has not revealed the amount of Williams' donation but said it was a seven-figure sum.
Williams has been caddie to Woods, the world golf No.1, since 1999, and is one of the highest-earning New Zealand sportsmen. He is also a New Zealand speedway motor racing champion.
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