The new deal, worth a reported $67.5 million, makes Romo one of the highest paid quarterbacks in the NFL. It also keeps him with the Cowboys through the 2013 season.
Romo has completed 62.8 percent of his passes for 1,984 yards, 16 touchdowns and nine interceptions this year for the 6-1 Cowboys. It is his first full season as the Dallas starter.
He was undrafted out of Eastern Illinois University and signed a free agent contract with Dallas in 2003. He started last season on the bench but was made the starter over Drew Bledsoe and played well enough to be selected to the Pro Bowl.
"This is just the beginning of what Tony is about as far as the Cowboys are concerned and what we believe to be our future," Cowboys owner Jerry Jones said.