"I'm very happy, very happy to be extending my contract with Paris until 2025," he said.
"The truth is that I'm very happy to be staying here for four more years, to be a part of the club's project, to try and win titles, to try and achieve our biggest dream which is the Champions League.
"So I'm happy to be staying at the club, to be a part of it and to be extending my contract."
Neymar, 29, joined PSG in 2017 from La Liga side Barcelona for a record transfer fee of €222 million ($270.02m).
He said he wanted to leave PSG in 2019 amid reports that he wanted to return to Barcelona, but eventually stayed before the club reached the Champions League final last season.
"The first factor is happiness. The joy of being part of this squad, of the team, of Paris Saint-Germain, the club," Neymar added.
"And then, of course, the affinity I have with the club, with the work, with the players that are in the squad today, with a great coach who will certainly help us even more. These things make you believe in the project even more."
In his first PSG news conference in two years last week, Neymar said was "really happy" at the club, hinting at a possible extension of his contract.
He was, however, unable to help the team reach a second successive Champions League final as PSG were knocked out in the semifinals by Manchester City with a 4-1 aggregate defeat.
"Of course, my goal when I came to Paris Saint-Germain was to help get Paris Saint-Germain to the top, among the very best, and we are getting close," Neymar said.
"We are gaining more and more experience to help us negotiate these types of games, to know how to play in the Champions League. And Paris is on the right track, we are getting closer and closer to the taste of winning the Champions League. I'm sure we can do it."
Information from Reuters was used in this report.