The 21-year-old joined Dortmund from Hoffenheim two years ago and recently scored his first Bundesliga goal against Eintracht Braunschweig.
He had two seasons left on his previous deal and the winger is delighted to have been handed a long-term extension by Dortmund.
"I've always been nurtured by BVB, I made the step from the reserves to the first team and I know that I will be given the confidence, support and patience to keep on improving," Hofmann told the club's official website.
"On a footballing and emotional level, Borussia Dortmund's overall package is hard to beat for a young player like me. I'm delighted to continue being a part of this great BVB family."
Dortmund's sporting director Michael Zorc added: "Jonas has made great strides forward in the last couple of months, but he has not achieved the end of his development just yet.
"We are pleased to work with him long term and accompany him on what hopefully will be the best part of his career."