Poulsen has called the Red Bull Arena home since the summer of 2013 and recently celebrated his 10th anniversary at the club.
Since signing from Danish side Lyngby, Poulsen has become Leipzig's record appearance maker with 370 games played and 85 goals scored.
Poulsen joined Leipzig when they were in the third tier of German football and has played an instrumental role in their rise to the top half of the Bundesliga and become regular participants of the UEFA Champions League, reaching the semi-finals in the 2019/2020 season.
The 29-year-old Denmark international has won two DFB-Pokal trophies and one German Super Cup with Leipzig.
"As I said recently, I'm still very keen to play for RB Leipzig. I'm finally injury-free again this season and can help my team on the pitch in the long term. I'm having a lot of fun with this team and I look forward to every training session, every game and every new challenge," said Poulsen after signing his new contract.
RB Leipzig sporting director Rouven Schröder added: "Yussuf Poulsen's story at RB Leipzig is extraordinary because of his journey from the 3. Liga to the Champions League and because of his long spell at the same club.
"Yussi has left a unique mark on Leipzig through his achievements and personality. You have to remember that he is only 29 years old.
"The way our fans celebrated him in the stadium on his tenth anniversary was an indication of his importance to the club and the city."
