He also led them to the semi-finals of the 2011 Rugby World Cup and earlier this year coached the British and Irish Lions to a series victory over Australia.
"I am proud and delighted to have been chosen by the Welsh Rugby Union to take charge of Wales teams for the next two Rugby World Cup tournaments," Gatland said in a statement on the Welsh Rugby Union website (www.wru.co.uk).
"I have chosen to stay in Wales because of my confidence in the players we have, the coaching structures we have developed and the succession plan of talent we now constantly update."
Gatland's current deal was due to expire at the end of the 2015 World Cup.
(Reporting by Josh Reich)
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