The extension -- which begins with the 2022-23 season -- is the maximum allowable off Smart's $14.3 million salary for 2021-22. The deal does not include a player option.
Smart has developed into one of the franchise's most important players, an elite defender and competitor who has twice been voted to NBA All-Defensive first teams.
Smart has played his entire seven-year career with the Celtics, who drafted him sixth overall in 2014.
Smart, 27, averaged career highs in points (13.1), assists (5.7), blocks (0.5) and minutes (32.9) for the Celtics last season.