Terms of the deal weren't announced as per club policy.
Vogel got the vote of confidence after taking the club into the playoffs in each of the past two seasons and guiding them to a Central Division-best 20-14 record so far in the current campaign.
"This is a good deal for Frank and the franchise," Pacers President of Basketball Operations Donnie Walsh said. "Frank has done a great job turning our team around since he became coach and deserves the chance to continue the work he and his staff have started."
Vogel has compiled 62-38 record in his tenure at the helm, including a trip to the Eastern Conference semifinals last season.
"I'm honored that Donnie, Kevin (General Manager Pritchard) and Mr. Simon (owner Herb Simon) have such belief and faith in me to be their coach in the foreseeable future," Vogel said.