The 25-year-old No.8 will also remain with the Queensland Reds for the length of his new deal.
"This is the only place I wanted to be. I want to give the best years of my rugby career to being part of success in the Reds and the gold jersey," Wilson said.
"Being part of a home World Cup is something you dream about.
"I didn't speak to another club. I didn't want to be a Wallabies captain shopping himself around the world," Wilson added.
"I'm the current Wallabies captain. Who am I to tell others to stay in Australia if I'm not signed, sealed and delivered myself.
"I'm delighted. There's no background noise entering the season. I can just play footy and it doesn't get much better than a Friday night at Suncorp Stadium.
"My manager said he'd get the deal done before the Reds' first game and he has. It's going to be a beauty against Moana Pasifika on Friday night."
Wilson has 22 Test caps, having struggled to cement his spot in the Wallabies side since his debut in 2020 until getting an extended run under Schmidt.
Reds coach Les Kiss was delighted with Wilson's decision."It's a great vote of confidence in our Reds program from Harry. What a guy to have as a mentor of our young forwards," Kiss said."He's a natural leader. The difference he makes in the locker room is palpable. This news will be welcomed by fans, stakeholders and the whole locker room."
