Toure, who turns 30 in May, pledged his future to the Barclays Premier League side with the new long-term deal which was confirmed this afternoon.
"This is where I want to be," Toure told the club's official website.
"When I first arrived at City, every time I went to sleep I would dream about us winning something.
"Now it is about us being the best team in whatever competition we take part in."
Toure joined City from Barcelona in July 2010 on a five-year deal which saw him link up with his older brother Kolo, who joined the club from Arsenal the previous year.
The midfielder, who has won the Champions League, two La Liga titles, a Barclays Premier League trophy, the FA Cup and Copa Del Rey during his career, revealed his decision to stay at City rests on his desire to claim more silverware.
"I want to continue winning titles and trophies and continue to make history," Toure said.
"I have enjoyed all of my time here and can't wait for the next chapter. This is an incredible club to be part of with fans that support a team to the end, whatever the circumstances.
"I will never forget how I have been treated here by the fans, the club and the owners and nothing would give me greater pleasure than to finish my career as a Manchester City player.
"Of course now it looks likely that we will not successfully defend the Premier League title and that is sad for all of us, but we can still finish second and win the FA Cup for a second time in three years and that is still an achievement for a club that won nothing for a long time.
"We must try to finish on a high note and then start preparing to win more next season. Football is always a challenge and always a puzzle to solve and that is why we all love the game.
"You have to use your skill, intelligence and strength to constantly improve and that is what we at City intend to do."