The switch-hitting second baseman's deal included a $1 million buyout if the option had been declined.
Oakland also announced Thursday that former outfielder and bench coach Mark Kotsay will work as a major league quality control coach, assisting manager Bob Melvin and his staff while also working closely with the front office in other areas.
Lowrie had one of his best seasons, hitting .277 with 14 homers, 69 RBIs and an Oakland-record 49 doubles. His 153 games were one shy of his career-best 2013 total in his first season with the A's.
Kotsay served as bench coach beginning Nov. 12, 2015, then took a leave of absence this past June for a family matter.