Boss Jos Luhukay has expressed his delight over Matt Penney committing his future to Sheffield Wednesday.
Penney, a graduate of the Owls' youth system, was due to become a free agent next summer.
But the 20-year-old agreed a new one-year contract extension earlier this week, tying him to the Championship club until the end of the 2019/20 campaign.
Luhukay said: "It’s fantastic that the club and Matt have signed an agreement. Matt is available in the future as a player, he has made really good progression in the last three months. We are very happy with him."
Penney has started nine matches and four substitute appearances this season.
"Matt can grow in every game he plays for us," said Luhukay. "He is a flexible player, and play in three or four positions in the team."
When quizzed on why the length of Penney's deal was not longer, Luhukay said: "I am not involved in the meetings that they had. For me it’s only important that we have Matt available for the next two seasons to play for us.
"We will see what the future is after that."