Burn has made 70 appearances since returning to the club from Brighton and Hove Albion in January 2022.
The 31-year-old spent time in Newcastle's youth system but was released aged 11 before embarking on spells at Fulham, Birmingham City and Wigan Athletic.
Since his return to Saint James' Park, Burn has helped Newcastle escape relegation, reach the League Cup final and finish in the top four, culminating in their participation in this season's Champions League.
After his new deal was announced, Burn said: 'It means everything to me to play for this club and to sign a new contract. I said when I signed that I didn't want this to be just a 'stop-gap' signing to keep us up - I wanted to be here for a long time.
'So personally it feels even more of an achievement signing this one than it was actually signing here in the first place. I'm delighted and looking forward to the next couple of seasons.'
Magpies manager Eddie Howe added: "Dan is a leader on and off the pitch, so we are delighted he has extended his stay with us.
"He is a key part of our squad and has played a huge role in our progress since his arrival."
Burn has made 10 appearances and scored two goals for Newcastle this season.
