The Daily Echo was first to reveal that the club skipper would earn a one-year extension after the club was promoted to the Premier League.
Now that deal has been confirmed, with Stephens tied down to the club until the summer of 2026.
He said: "That contract was the agreement last summer that if we did get promoted, it would trigger another year, so I'm delighted with that.
"It was a win-win for everyone, to be honest. My first thought was getting the club promoted but it's worked well for me getting the extra year.
"I'm very excited for the next two years. I'm excited for the Premier League. I'm excited for the first game. It's a big challenge but they're all tough.
"The league is getting harder and harder and you almost want a big test early on. Newcastle away is going to be a fantastic place to go and play."