The 26-year-old has become a key player for the Gunners since joining the club from Lorient two years ago.
Arsenal manager Arsene Wenger told the club’s official website: “Laurent has been outstanding for us over the last two seasons.
“When you consider that until 2009 he was playing in Ligue 2 in France and that he is now performing at the very top level in the Premier League and for his country, the development that he has shown has been absolutely exceptional.
“Laurent is a top-class player and I am very pleased he has decided to commit his future to the Club.”
“I’m delighted to have reached agreement with the club,” said Koscielny.
“I have had a fantastic time here and look forward to an exciting future with Arsenal.”