The 23-year-old also has the option to extend the contract by a further year when it reaches its conclusion.
Mac Allister joined Brighton from Argentinos Juniors in January 2019 but remained at the club on loan before spending another loan stint at Boca Juniors.
He returned to the AMEX Stadium in the second half of the 2019/2020 season and has since become a regular under both previous manager Graham Potter and new boss Roberto De Zerbi.
The Argentina international has scored four goals in 11 Premier League appearances for Brighton this season.
On his new deal, Mac Allister said: “We’ve been discussing a new contract for a few weeks, and I’m very happy it’s all agreed and signed.
“I am really happy here at Brighton. I’m grateful for the opportunity the club gave me to come to England and play in the Premier League, and it’s been an incredible journey.
“We have made great progress with Graham Potter, and I know there is more to make. I am now enjoying working with another top coach in Roberto De Zerbi and want to help the club to keep progressing.”
Brighton head coach De Zerbi added: “I’m very happy for Alexis and for the club. He is an important player for us, and it is very good he has signed this new long-term contract.
“I am looking forward to working more with him, helping him to improve, and to seeing him play at the World Cup next month.”
Mac Allister has won seven caps for the Argentina national team.
