Wright is coming off a career-best 53 goals in 2022, when he claimed Essendon's best and fairest, and was due to come out of contract at season's end.
The four-year extension continues Wright's remarkable career turnaround since he was offloaded by Gold Coast for a future fourth-round draft pick at the end of 2020.
"I've loved my time so far at the Bombers and am extremely grateful to the club for the opportunity," Wright said.
"I am especially grateful for the time both players and coaches have put in to help me continue to develop as a player and a person at the club.
"I'm very excited about the direction that Brad is taking us, and this Sunday is a great opportunity to take the first step and put into practice the work we have done over the pre-season.
"We've got a young and exciting list that I am excited to build and grow with. But we know there is a lot of hard work ahead for us to ensure that we get where we aspire to be."
Pick No.8 in the 2014 draft, Wright booted 85 goals in 66 games at Gold Coast before joining Essendon.
The 26-year-old's re-signing is a huge boost ahead of Sunday's season opener against Hawthorn at the MCG.
"Pete is a very important part of our side. He provides a fantastic target up forward, with strong marking and goalkicking ability," list boss Adrian Dodoro said.
"He is extremely dedicated and has excellent work ethic. Pete is constantly striving to improve, evident in his growth over the past two years.
"At 26 years of age, Pete is a long-term player for our club who will play a key role in this young group moving forward in the years to come."
Essendon's focus will likely now turn to re-signing free agents Darcy Parish and Mason Redman.
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