Drinkwater, 26, joins Jamie Vardy, Riyad Mahrez and Kasper Schmeichel in committing his future to the club since the end of last season. "I've loved playing for this club. It's been perfect for me and my career and I want to be here for a long time to come. I couldn't be happier," Drinkwater told Leicester's website.
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Drinkwater joined Leicester in 2012 from Manchester United and has made 177 appearances for the Foxes.
He was named the club's player of the year as Leicester won promotion back to the top flight in the 2013-14 campaign, and last season played a key role as the Foxes became the most unexpected champions in Premier League history.
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Drinkwater, who won the first of his three England caps against the Netherlands in March, added: "I've grown a lot as a player and a person in the last four years and Leicester has been a massive part of that.
"I love being part of this team. We've been through so much together and I'm sure there's a lot more to come."
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