Gordon, who is entering the final season of the four-year contract he signed with the Rockets as a free agent in 2016, will earn about $90 million over the next five seasons.
The 30-year-old guard alluded to the agreement Saturday on social media, saying "signed, sealed, delivered" with rocket ship emojis.
Gordon was the NBA's Sixth Man of the Year in the 2016-17 campaign and was the runner-up in the next season before sliding into the starting lineup last year. He has averaged 16.8 points, 2.4 rebounds and 2.2 assists per game in his three seasons in Houston.
The Los Angeles Clippers selected Gordon with the No. 7 overall pick in the 2008 NBA Draft out of Indiana. In 11 seasons in the league between the New Orleans Hornets/Pelicans, Clippers and Rockets, he has averaged 16.7 points, 2.9 assists and 2.5 rebounds.