Giggs’s contract was set to expire at the end of the season, but his new deal will see him stay with the Old Trafford Club until June 2010.
He told the club’s official website that he is “delighted to be offered a new contract”, adding: “I feel fit and I’m enjoying my football more than ever.
“This is an exciting young team and the spirit is great in the dressing room. I want to be a part of that and achieve even more success.”