The population of seniors reached 25.6 million, a record high, last year, translating into 20.04 per cent of the total population, up 0.54 per cent from the year before, the Cabinet Office's white paper on aged society said.
The report came a day after the Health Ministry announced the country's birth rate last year dropped to a record low of 1.25 babies per woman, down from 1.29 in 2003 and 2004.
The declining birth rate and expanding elderly population pose serious concerns for Japan as it has to tackle a labour shortage and eroding tax base.
The white paper portrayed an even grimmer picture for the future, saying roughly one in four Japanese may be aged 65 or older in 2015, and about one in three in 2050.
The elderly population is expected to continue rising until 2020 but the total population is expected to decrease, pushing up the ratio of the elderly, it said.
The government said earlier this year that the nation's population dropped last year for the first time on record.