The Rojiblancos have also tied Oliver Torres and Javier Manquillo down to long-term contracts at the Vicente Calderon.
The 21-year-old, who has been named in the Spain squad for a World Cup qualifier against Finland on Friday, has put pen to paper on a new deal with the Rojiblancos that will keep him at the Vicente Calderon until 2018.
"I am happy to give more years to Atletico," Koke told his club's official website. "I am on the team of my life and I cannot ask for more. I want to continue working to try (to) bring new success and better achievements than last year. I am very happy."
Meanwhile, fellow academy products Olivier Torres and Javier Manquillo have also signed five-year extensions with the Copa del Rey winners.
Manquillo said: "It is a joy to extend my stay at the club which I have spent so many years. I am delighted and I'll keep striving to improve my game."
Torres added: "The club wants me to stay longer and that makes me very happy. I want to work hard and continue growing as an Atleti player."