United made the announcement via their official website.
Valencia said: "Manchester United has been my life since 2009, and I am absolutely delighted to have signed a new contract."
Should the Ecuador international see out his new deal, he will celebrate a decade at the club.
Red Devils boss Jose Mourinho noted: "It is no secret that I had been an admirer of Antonio's long before I joined the club. I knew what a fantastic player he was, and he has not disappointed me on that front."
ESPN's Alex Shaw hailed the decision to hand the former Wigan Athletic man an extension:
Valencia has been resurgent under the Special One, recapturing the exceptional form he showed earlier in his United career.
Football writer Liam Canning praised the right-back's performances this year and believed he was a strong choice to lead out the team for their UEFA Europa League final triumph over Ajax on Wednesday:
His overall performance this season was also recognised by his peers, per United's official Twitter account:
According to Squawka, he showed his defensive quality in the Premier League this season by making 44 tackles, 42 interceptions and 67 clearances, while at the other end, he scored once, assisted three times and created 32 chances overall.
Reliable at the back but capable of marauding runs forward, the hardworking Valencia has successfully transitioned from a winger into an excellent full-back during his time at Old Trafford, and despite being set to turn 32 in August, he has continued to produce consistently strong performances.
United will soon need to find a long-term replacement for him, but locking him down for the next couple of seasons while they work on that is a shrewd move.