Starting Monday, most diesel and gas vehicles registered before 2006 - as well as some later models - will be subject to a £10 ($13) "T Charge" when entering central London between 7 a.m.to 6 p.m. Monday to Friday. That's on top of an existing £11.50 ($15) congestion charge collected from drivers in the city center.
About 438 schools in London are in areas exceeding legal air quality levels, according to the London mayor's office.
The measures comes after Britain's High Court ruled that United Kingdom government measures to combat air pollution were failing to comply with European Union rules on nitrogen dioxide limits. "This is the time to stand up and join the battle to clear the toxic air we are forced to breathe".
It is due to be replaced by a stricter Ultra-Low Emission Zone in 2020, although Mr Khan is consulting on bringing this forward to 2019.
According to a 2015 study by researchers at the King's College London, almost 9,500 Londoners die prematurely every year as a result of long-term exposure to air pollution.
"Today marks a major milestone in this journey with the introduction of the T-Charge to encourage motorists to ditch polluting, harmful vehicles".
The T-charge is part of a wider push from Mayor Sadiq Khan to improve air quality research and communication in the capital.
Shaun Bailey, conservative environment spokesman at the London Assembly, told BBC News: "As an asthmatic I'm well aware of how critical an issue this is for London but we need policies that actually deliver progress". Children are particularly at risk due to their developing lungs.
However, she said it was "only one step towards clean air".