The midfielder joined the Tractor Boys from Middlesbrough in 2021 and has bagged 10 goals and 22 assists in 131 appearances for the club.
Manager Kieran McKenna's side has had back-to-back promotions in the past two seasons after Morsy joined the club and became a bold captain, leading the side to the Premier League for the first time in over 20 years.
The midfielder spoke about what a proud time it is to be at the club.
"I'm going into my fourth season at the club now and we've had unprecedented success during the last two years, which is something I'm honoured to have been involved in," said Morsy.
"It's great to feel the club and the manager's commitment to me at such an exciting time for everyone, as we prepare for what is the biggest challenge of them all."
Mckenna also had a lot to say about the captain and how he has been a huge influence in the club's success.
"The leadership he (Morsy) has shown has been key in building a strong culture, which underpins everything we do," McKenna said.
"I know Sam is excited to now have the opportunity to test himself at the highest level of the game."
Ipswich host Liverpool on the 17th August in their opening game which will be a huge test for the side who will be fighting against relegation next season.