from The American Heritage® Dictionary of the English Language, 4th Edition
- n. Slang A wealthy, usually older man who gives expensive gifts to a young person in return for sexual favors or companionship.
from Wiktionary, Creative Commons Attribution/Share-Alike License
- n. A man who spends money for the benefit of a younger person, especially a younger woman.
from WordNet 3.0 Copyright 2006 by Princeton University. All rights reserved.
- n. a wealthy older man who gives a young person expensive gifts in return for friendship or intimacy
Apparently from slang sugar "money" and colloquial daddy "father". (Wiktionary)