Sauerbrun, a two-time Pro Bowler, had been designated the team's franchise player. He signed a one-year tender for $1.47 million, the average salary of the top five kickers and punters, in late April.
The Panthers vowed to negotiate a long-term extension after designating him as a franchise player and lived up to their promise.
"We are thrilled to have Todd Sauerbrun signed for the next five years," said General Manager Marty Hurney. "He is an extremely valuable player to our organization, and anytime you have a player of Pro Bowl caliber on your team, you want to keep him."
Sauerbrun, 30, was selected to his second straight Pro Bowl last season after leading the NFL with a 45.5-yard average on 104 punts. His net average of 37.5 yards was fourth in the league. He tied for second with 31 punts inside the 20-yard line.