The 28-year-old Argentine has established himself as a firm favorite at the Etihad Stadium since signing five years ago, and he is delighted to have penned an extension.
The Argentine has made has made 175 appearances for City since signing from Espanyol in 2008, and he has emerged as the club's first-choice right back in recent seasons.
"I have been here for five years and it feels like home. Signing a contract extension with the club makes me feel very happy," Zabaleta told the club's official website. "I feel great here, I like the Premier League, and I think Manchester City are one of the clubs looking for success in the future. It is a club that is very well-organized, and when you see that everything works well you want to be here."
Manuel Pellegrini takes charge of his first competitive game as City manager against Newcastle on Monday, and Zabaleta hopes it will be the start of a successful campaign.
"I think we have got a great squad, fantastic players and hopefully we can win something this year," Zabaleta said. "I am sure the fans will respond very well as always. They are a big support for the team week-in week-out, and hopefully at the end of the season the fans and players can celebrate with a trophy."