The deal will keep the 2000 first-round pick under contract through the 2018-19 National Hockey League season. He would have become an unrestricted free agent in July.
"Signing Kronwall and keeping him here is a real important step for us in the next 12- to 24-month process of trying to figure out where we will be going forward," Red Wings General Manager Ken Holland told the team's website.
Kronwall set personal highs for goals (11), power-play goals (5) and game-winning goals (3) last season. He has two points in nine games this season.
The 30-year-old Kronwall won a Stanley Cup with Detroit in 2008 when he led all NHL defenseman in playoff points. He also captured a gold medal with Sweden at the 2006 Winter Olympics.