No details were given on the Liverpool website but media reports indicated the midfielders' deal was for five years and worth at least 100,000 pounds ($150,000) a week.
"It's brilliant news for me to commit my future to this football club -- I really feel that it's a good time for us to look forward to the future, with the squad we've got, the manager, the size of the club and the fans we've got," said the 24-year-old England international.
"I really think, over the next few years, we can challenge and start winning trophies."
Henderson, who had been in contract talks for months, joined Liverpool from Sunderland in June 2011 and has made 180 appearances for the club.
With club captain Steven Gerrard moving on to Los Angeles Galaxy at the end of the season, Henderson has emerged as the next leader on the field.
"The fact he has made such a long-term commitment to Liverpool is a sign of his belief in what we are looking to do here," said manager Brendan Rodgers.
"He will have a crucial role to play as we look to take this side forward and look to add success to the progress we have made."
Rodgers added that he expected to see more contract renewals as well as additions to the squad. Midfielder Philippe Coutinho and forward Daniel Sturridge have both already agreed long-term contract renewals.
Another key player Liverpool want to keep is England forward Raheem Sterling, although Rodgers has said a new contract will not be discussed until the end of the season.
(Reporting by Alan Baldwin, editing by Pritha Sarkar)
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