Terms of Gallant's contract were not disclosed by the Panthers, who are second in the Atlantic division and fourth in the Eastern conference in 2015-16.
Gallant - appointed in June 2014 - guided the Panthers to a 38-29-15 record and 91 points in his first year in charge last season, making them the most improved team in the NHL.
"I'm thrilled to be signing an extension with the Panthers," said the 52-year-old.
"I want to thank our owner Vinnie Viola and his partner Doug Cifu for the confidence they have placed in me and their continued support.
"We've started to build a strong foundation with a great staff and group of players here in Florida. We want to continue to build on the recent success we've had and create a winning team for years to come."