Millwall have yet to choose a new manager amid speculation former Liverpool defender Markus Babbel is set for the job.
Ipswich Town defender Tommy Smith has committed his future to the club until the summer of 2016.
The 29-year-old former West Ham striker has agreed to remain at the Stadio Renato Dall'Ara for the next five years.
A statement on the club's official website said: "Bologna have reached an agreement with Alessandro Diamanti to prolong his contract until June 30, 2017."
Diamanti, who fired seven goals for the Rossoblu last season, scored the winning penalty as Italy beat England 4-2 in a quarter-final shootout at this summer's European Championships.