The 32-year-old has been at Goodison Park since the start of his career and he was happy to pledge his future to Everton, despite the uncertainty about the club's next manager.
David Moyes ended his long reign at Everton to take charge of Manchester United this month, but Osman had no concerns about remaining on Merseyside.
Osman has enjoyed a successful season, including call-ups to the England squad, and captained the Toffees at times as the team secured a top-six finish.
"I am delighted to have put my signature on another contract and secured another year at the club," said Osman, whose previous deal ran out next year.
"I have been here since I left school, I am a player and a fan, I love coming to work every day and I am delighted that's going to continue.
"We are not quite sure what's going to happen with a manager but I am still delighted to have secured my future here at the club.
"It's time to take the family on holiday now, enjoy it and recharge the batteries for next season."