The new deal will keep the 20-year-old at the club until the summer of 2010.
Hines has impressed for the Hammers this season after scoring on his senior debut, against Macclesfield in the Carling Cup.
“I am really happy to sign the contract,” he told the club’s official website.
“I didn’t know if I was going to get one but it is good to know the club has a bit of faith in you.
“I just want to show the manager (Gianfranco Zola) what I can do and repay all the support he has given me. I have got to prove to him that I am worth this contract.
“He has seen a little bit of what I can do in training but I have just got to try and do my best. Next season has to be the one for me to push on.”