The 30-year-old Republic of Ireland international joined Norwich from Blackpool in June 2008 and was instrumental in helping them secure successive promotions through to the Premier League.
Hoolahan told the club's official website: "I am over the moon. I always wanted to sign a new deal and the club have given me the opportunity to sign a long-term one. I couldn't be happier.
"I have been here for four years and this would take me to seven.
"I have really enjoyed my time here, my family love it here and I am just looking forward to the rest of the season now. We have got some top-quality players here."
Hoolahan, who has netted 33 goals in just over 160 appearances, added: "The last couple of years have been great coming up from League One all the way up to the Premier league and doing so well last year.
"We are doing even better this season and hopefully we can keep that run going.
"The last few months I have been playing and it is just great to be involved with the lads. We have got some top-quality players here and I am really enjoying it."
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