Fort Eustis' first hospital opened on March 26, 1941, and was commanded by Colonel William Borden. The War Department declared the hospital surplus property in August 1944 and transferred it to the Navy Department.

The hospital was transferred back to the Army on February 1, 1946, and renamed U.S. Army Hospital, Fort Eustis on September 1, 1948. In March 1961 it was renamed for Brigadier General Robert McDonald.

The current facility was built in 1964, and saw the additions of an outpatient clinic in 1976, orthopedic and women's health clinics in 1993, administration building in 1998, and business office in 1999.

The hospital today is a 30-bed JCAHO-accredited facility, but does not provide inpatient or emergency care. Major services include adult and pediatric medical and surgical care and an urgent care clinic.