The new deal will keep the 19-year-old midfielder at Tottenham until 2021.
Alli has made a huge impact at White Hart Lane since joining Spurs from MK Dons on transfer deadline day in February.
“I’m delighted. The club has been really great to me since I arrived,” Alli told Spurs TV.
“We have a great young team and I can only see us moving forward. I am really happy to be here.
“When I signed here I wanted to play for Tottenham and I was not thinking about going anywhere else at the time. The manager and everyone have helped me a lot and thankfully I have broken in and got a few games.
“I have shown a lot of people what I can do and established myself as a Premier League player but I am 19 and I have still got a lot to learn. I can’t think of a better place at the minute to do that.
“When I was moving from MK , the philosophy they had as a club, it was important I found that, wherever I went. The football suits me as a player and it’s a great club to be at.
“Nothing changes with the contract, I’m still going to keep working hard on and off the pitch and doing as well as I can.”