The Blades have earned two promotions in three seasons since Wilder took charge in May 2016.
After guiding Sheffield United out of League One with 100 points in his first campaign at Bramall Lane, the 51-year-old ended the Yorkshire club's 12-year exile from the top flight by finishing second to Norwich City in the Championship last season.
Wilder was handed both LMA Manager of the Year and Championship Manager of the Year awards for his achievements with the club last season, leading them on a surprise charge back to the Premier League.
"Chris signing a new contract underpins everything we are attempting to do at Bramall Lane," chief executive officer Stephen Bettis told the Blades’ official website.
"He's been the catalyst for our success over the past few years, he is a driven individual and his focus since promotion was secured has been preparing the club for the Premier League."
Next season will be the first time Sheffield United have been in the top-flight since the 2006/07 season, when they were managed by Neil Warnock.
Wilder and his staff will be hoping for a better ending to the upcoming season however, as the Blades were relegated after finishing 18th – level on points with 17th-placed Wigan Athletic but with a lower goal difference by one.
It will be the first time that Wilder has coached in the top-flight, having previously managed Alfreton Town, Halifax Town, Oxford United and Northampton Town before taking the reins at his boyhood club.
The 51-year-old is in the process of strengthening his squad ahead of their Premier League opener against Bournemouth on August 10.
Jagielka came through the youth ranks at Bramall Lane and was vice captain in their most recent Premier League season.
The centre-back made 287 senior appearances across seven seasons with the first-team, and played all 38 games during the 2006/07 season in the top-flight.