The Toffees' Irish defender has penned a new three-year contract that will keep him at the club until 2015, having previously had loan spells at Burnley and Scunthorpe United
The Republic of Ireland Under-21 defender joined the Toffees in 2008 and has made four senior appearances for Everton, and has also spent time on loan at Burnley and Scunthorpe United.
"I'm delighted to get it done. It's taken a bit of time to get it sorted but I am happy now," Duffy told the club's official website.
"I have been here for a while now and loved every minute of it. Now this is sorted I can focus on working hard and continuing to improve."
Duffy made his league debut for Everton earlier this year against Tottenham, and his first start for the club came a few days later in a 1-1 draw against Aston Villa.
Duffy hasn't featured in the league this season for Everton, but came off the bench to replace Leighton Baines in the 5-0 League Cup victory over Leyton Orient.