The new deal will keep the 21-year-old at the Liberty Stadium until the summer of 2016.
"Iím absolutely delighted," declared Alfei. "Itís good to know the club has faith in me and there is nowhere I would rather be than Swansea."
Alfei has spent most of the season on loan at Wrexham.
"The loan spell at Wrexham was great for me," he added. "Itís a good club and I really believe I learnt a lot there this season. Itís made me a better player.
"Obviously itís been difficult at times for me this season because of the injury, especially after missing out on their two trips to Wembley - what are the odds of that happening?
"But thatís all part of my development and I wouldnít rule out going on loan somewhere again next season. I think thatís probably what I need to keep progressing before hopefully returning to push hard for a place in the first team.
"I think Ben Davies has proved to all the youngsters what is possible. Iím sure he didnít expect to play regularly in the first team this season, but he took his chance when it came along and did really well. I know Benís example doesnít happen too often, but you never know, especially when it comes to injuries."