Leandro, who has been linked with a move to Tottenham in recent weeks, has signed a five-year deal with the club.
“Plaudits must go to president Giovanni Luigi, who did a tremendous effort to keep him with us for this season,” said coach Paulo Roberto Falcao.
“This new agreement gives us peace and we can now close the talk of his departure.
“Now Leandro Damiao is at a wage level with the most valued players in the country.”