The new deal is a reward for his progress since arriving from East Midlands rivals Nottingham Forest for an undisclosed fee last summer.
Freeman, 21, made his Rams debut as a substitute in a 4-1 home victory over Blackpool at the start of November and the player has gone on to make 15 appearances for the first team this season.
In the absence of the injured John Brayford, he has started at right-back in the last three wins against Leicester, Bristol City and Leeds but he has demonstrated that he can also play in the opposite full-back berth or in midfield.
Derby manager Nigel Clough told the club's official website: "Kieron is a player we have an awful lot of faith in and we think he's going to be a very good player in the future.
"He's got all the right attributes to be an extremely good defender and he's got a good opportunity at the moment, with John out injured, to build up his Championship experience.
"We've been pleased with his progress over the last few months and he's not looked out of place when we've put him in the first-team.
"He's had to wait patiently for his chance but his attitude has been excellent from the minute he walked through the door and he's grasped the opportunity we've given him, which is exactly what we're looking for from our younger players.
"It's pleasing to once again secure the services of one of our promising young players on a long-term contract and that Kieron sees the direction we're moving in."