The contract is a super-maximum extension that will guarantee Harden $228 million through the 2022-23 season, league sources told ESPN's Adrian Wojnarowski and Brian Windhorst on Saturday.
"Houston is home for me," Harden said in a statement released by the Rockets. "(Owner Leslie Alexander) has shown he is fully committed to winning and my teammates and I are going to keep putting in the work to get better and compete for the title."
Harden, runner-up for the NBA's Most Valuable Player award last season, has two years and $59 million left on his current contract. The four-year extension carries a value of $170 million.
The Rockets fast-tracked the Harden extension with the arrival of All-Star guard Chris Paul from the Los Angeles Clippers, and reportedly are trying to complete a deal with the New York Knicks for eight-time All-Star forward Carmelo Anthony.
With the mega-deal, Harden is taking advantage of new collective bargaining agreement rules that enable contract extensions for superstars. He became eligible to add four years to his deal after making the All-NBA team in May.
Harden is coming off a career-best season in which he averaged 29.1 points, a league-best 11.2 assists and 8.1 rebounds per game.