The day after lifting the Europa League trophy in Amsterdam, the 34-year-old has put pen to paper on fresh terms to keep him at Stamford Bridge for another year
The midfielder, 34, has long seen his future shrouded in speculation as his current contract was set to expire at the end of the season.
However, after picking up the Europa League trophy thanks to a last-minute winner from Branislav Ivanovic, Lampard has ensured he will stay with the club for a minimum of one more year.
"I'm absolutely delighted. Everybody knows I always maintained the dream was to stay at Chelsea. We've been talking for ages and even though it went on for quite a period it was always amicable," he told the club's official website.
"I want to thank Mr [Roman] Abramovich for everything he's done in making the dream a reality. I love this club, the staff, the players and especially the supporters, who have treated me fantastically since the day I arrived.
"The thought of helping the club to more success in the forthcoming years is all I ever wanted. I couldn't be happier."
Lampard became the club's all-time leading goalscorer thanks to two strikes against Aston Villa that also sealed their place in the top four of the Premier League.
Since joining from London rivals West Ham in 2001, Lampard has won the Premier League three times, the FA Cup four times, the Capital One Cup twice, the Champions League and now the Europa League.
In April, Lampard became only the third player to make 600 appearances for the club (now on 607), but is unlikely to catch either Peter Bonetti (729) or Ron Harris (795) before the end of his career.