The 66-year-old man is understood to have suffered serious chest injuries in the incident, which happened at a wood processing plant in Portnoo yesterday evening.
Fire and ambulance crews and a Garda unit attended the scene of the incident at North West Wood Products.
The Health and Safety Authority have launched an investigation as the incident occurred in a workplace.
It is understood that a machine moved forward and crushed the victim against a wall.
He was taken to Letterkenny General Hospital by helicopter for treatment around 5pm. He has since been removed to the Mater Hospital in Dublin.
The man who only retired a few months ago, was fixing a machine when the incident happened.
Locals have been left distraught by the incident.