The new deal will keep the 67-year-old at St James’ Park for a further eight years.
Carr has helped the Magpies recruit the likes of Yohan Cabaye, Demba Ba, Papiss Cisse, Cheik Tiote and Sylvain Marveaux for modest fees in recent seasons.
Newcastle managing director Derek Llambias said: “We are delighted to have agreed an eight-year deal with Graham, and very pleased that he has committed his long-term future to the club.
“He has been instrumental in helping us to bring some truly exceptional players to Newcastle United and he has deservedly built one of the best reputations in the business.”
Llambias said: “Graham works tirelessly to identify talented young players from across the world and has done a magnificent job over the last two years.
“He has the complete faith and support of the owner, the board and the manager, and it is excellent news that the club will continue to benefit from his expertise for many years to come.”
