Larranaga has coached the Hurricanes to a combined 49-20 record in his two seasons at Miami. Last year the Hurricanes were 29-7, won the ACC regular-season title and the ACC post-season tournament.
The 29 victories in 2011-12 mark a school record.
"We want to build a tradition of excellence at the University of Miami," Larranaga said in a statement Thursday. "The most important aspect for me and our staff is to create consistency. With this extension the university has shown its commitment and I am grateful for its confidence in our program."
Financial terms of the new deal weren't released.
Larranaga previously coached at American International (1977-79), Bowling Green (1986-97) and George Mason (1997-2011), building an overall record of 519-354. He owns the record for most coaching wins at George Mason with 273.