The Stoke midfielder saw his initial month-long stay expire after Saturday's 1-1 draw against Torquay, but manager Paul Sturrock has moved to keep him at Roots Hall for the remainder of the Shrimpers' play-off charge.
Lund, 22, has so far made eight appearances for the Essex club, scoring once on his debut against Northampton, and will be available for Tuesday night's home clash against Plymouth.
"I've really enjoyed my time at the club so far so I am pleased to be staying here for longer," Lund told Southend's official website.
"The lads have been excellent and there's some big games coming up. Hopefully I can play a helping hand in pushing us back into the play-off places."
Boss Sturrock said: "Matt has done very well for us since he came in on loan in February. He has looked very assured in the midfield and has a very important part to play for us in the remainder of the season."
