The new contract, which was agreed to last week but only signed on Monday, ties the player to the team until 2016 and includes a 10 million euro release clause.
"I’m very proud and I’m very happy, I’ve dreamed about this since I was a child," Tello said. "I want to return the confidence to those who have confidence in me."
Tello made his first-team debut for Barcelona on Nov. 8, 2011, in a Copa del Rey match against Hospitalet, scoring twice in a 9-0 rout. The 21-year-old La Masia academy product has so far made 23 appearances for the Catalans, scoring five goals in the process.