The 30-year-old has been a key member of the team since joining the club from Aston Villa in the summer of 2007.
Hughes’ new deal will keep him at Fulham until 2013.
“I’ve enjoyed my time at Fulham even during my first season when things weren’t going too well on the pitch so I’m delighted to have signed a new deal with the club,” Hughes told Fulham’s official website.
“The team has performed well all last year and this form has continued into this season so I’m really delighted that I will be here for a bit longer.”