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O’Neill, 48, had been chased by the Scottish FA as they seek to find a successor to Gordon Strachan. After turning down the SFA following talks last month, O’Neil agreed a new deal worth a reported a record £700,000 (790,000 euros, $974,000) a year salary for a Northern Ireland manager to remain in charge.
“I am extremely proud to manage my country and I am pleased to be extending my time in charge of the senior team,” O’Neill said in a statement released by the IFA.
“In recent months I have been approached about taking other opportunities in football. However, no other challenge attracted me as much as taking Northern Ireland back to a major tournament.”
O’Neill masterminded Northern Ireland’s qualification for Euro 2016 and even progressed to the last 16 in France before losing out narrowly 1-0 to Wales.
However, they fell just short of qualifying for this year’s World Cup when they lost 1-0 to Switzerland in a two-legged playoff in November.
As part of his new contract, O’Neill will also take up the role of Chief Football Officer and will have overall responsibility for the development of the game in Northern Ireland.
“We wanted him to continue as not only has he brought success to our senior men’s international team, but his positive influence extends to all levels of football in Northern Ireland,” said IFA president David Martin.
O’Neill’s men don’t have another competitive match until September when they kick-off their qualifying quest for Euro 2020 with the debut of UEFA’s Nations League against Austria and Bosnia and Herzegovina.
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