The Mavericks announced the new deal after Carlisle became the winningest coach in franchise history last week. He is in the final year of his current contract that includes a team option for next season that will be exercised.
"(Owner) Mark Cuban, (Mavs president of basketball operations) Donnie Nelson and Dirk Nowitzki are the reason an extension like this is possible," Carlisle said.
The 56-year-old Carlisle passed Don Nelson four days ago to become the winningest coach in Mavs history with a 340-222 record entering Thursday night's game against the Charlotte Hornets. Carlisle has one NBA championship to his credit with the Mavericks in 2011.
Only two other current NBA coaches -- Miami's Erik Spoelstra and San Antonio's Gregg Popovich -- have been with the same team as long as Carlisle.