Tigers director of rugby Richard Cockerill said: "We told Geoff that he has always been part of our plans going forward and it is very good news that he has decided to stay with us.
"He has been an important guy for us over the last four seasons and is now an established international player too.
"His decision shows the quality of the environment we have at Leicester Tigers and that plays a big part in players wanting to stay here. Geoff wants to continue to develop as a player and he agrees with us that he can do that best by playing for Leicester Tigers."
The 29-year-old Parling has made 60 appearances for Leicester Tigers, including the Premiership Final victory in 2010 and last year's final at Twickenham.
He joins fellow England internationals Tom and Ben Youngs and Tigers forwards Graham Kitchener, Steve Mafi and Julian Salvi in agreeing terms to contracts beyond the end of the current season.