The former Middlesbrough defender moved to the Reebok from Teesside two years ago for an undisclosed fee.
He has since gone on to make 44 appearances for Bolton, scoring three goals, but was restricted to just four substitute appearances last season.
"I'm very happy to have signed," he said. "I believe we have a real chance to move forward this season and the manager is certainly the right man for us.
"I also believe he can help get the best out of me as a player. I'm very happy living in the area and have made lots of new friends since moving here from Middlesbrough."