"It was a case of coming back after winning the Premier League and making sure the hunger was the same within myself and the squad," Danish international Schmeichel told the club's website on Saturday.
"I've come back absolutely convinced this is the place for me to be. We've taken some massive steps and ever since I arrived it's been fantastic. I've loved being here from minute one."
Schmeichel joins captain Wes Morgan and striker Jamie Vardy in signing new deals.
Claudio Ranieri's men start the league campaign with a trip to promoted Hull City on Aug. 13.
(Reporting by Shravanth Vijayakumar in Bengaluru; Editing by Tony Jimenez)
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