Ian Rapoport of the NFL Network reported it's a short-term deal. Financial details weren't immediately released.
Chung was set to enter the final year of his previous contract before the extension.
The 30-year-old University of Oregon product tallied 84 combined tackles, nine passes defended, two fumble recoveries and an interception while playing all 16 regular-season games in 2017. He added 22 tackles in three playoff contests during the Pats' run to Super Bowl LII.
Pro Football Focus graded him as the league's No. 42 safety last season.
Chung was the Patriots' second-round pick in 2009. He briefly left the organization to sign with the Philadelphia Eagles in 2013 but returned to New England after being released in 2014.
In January, the Jamaica native talked about his wide-ranging role within the Pats' defensive scheme, which includes sometimes shifting up to play linebacker, per Anthony Gulizia of the Boston Globe.
"It just comes back to hard work," Chung said. "If someone puts something on your plate and tells you, 'Hey, you need to do this, we think you can do it,' you've got to take that as a compliment and just work hard and do whatever you have to do to keep that respect and trust. That's what I'm trying to do."
His versatility should ensure he remains a lynchpin of the Patriots defense for the duration of his new contract.