"I am excited to be a Cowboy for life," Ratliff said Friday.
The deal includes $18 million in guaranteed money. The Cowboys have had talks with his agent, Mark Slough, since the early part of training camp and Slough was at the team's Valley Ranch facility earlier in the week.
If he reaches the end of the deal in 2017, the 30-year-old Ratliff essentially would be a Cowboy for life.
Ratliff declined to answer further questions, saying he wanted to focus on football.
Ratliff had two years remaining on his contract with base salaries of $3.75 million and $4.875 million. In 2007 he signed a five-year, $20.9 million extension and has since played in the Pro Bowl the past three seasons.
Ratliff has started 63 games in his career and has 25 sacks. He took over as a starter in 2007 after Jason Ferguson suffered a torn triceps in the season opener and developed into one of the best nose tackles in the game. While undersized for a traditional 3-4 scheme, Ratliff uses his speed, quickness and leverage to make plays.
Like Dallas' entire defense last season, Ratliff's numbers were down (34 tackles, 3½ sacks), and for the first time as a starter, he did not have a tackle for loss.
But with Rob Ryan taking over as defensive coordinator, the Cowboys believe those numbers will climb, with Ratliff being moved all over the defensive line.
Todd Archer covers the Cowboys for ESPNDallas.com. Tim MacMahon of ESPNDallas.com contributed to this report.