Tandy was appointed to the post in February 2012, with Rees' appointment following just two weeks after, the pair helping the Ospreys towards a record fourth league title just three months later.
The news will provide a welcome boost as the team prepares for Friday night's final day RaboDirect PRO12 clash with Leinster in Dublin, the scene of the memorable PRO12 Final victory last May, where an Ospreys win is required to keep alive their title defence.
Confirming the news that Tandy and Rees have signed new deals Andrew Hore, Chief Operations Officer at the Ospreys, said:
"Steve and Gruff are two of the brightest, most exciting young coaches around and have already developed excellent reputations as innovative, forward thinkers.
"Products of the well established coach development pathway we have in place here at the Ospreys, they have both worked extremely hard to help put foundations in place over the last 15 months to help ensure a sustainable, long term future for the region.
"They have had to face up to a number of challenges but have tackled them head on in a typically forthright manner, not shirking the tough decisions, and whatever happens in the PRO12 this weekend we are now in a strong position to kick-on for next season and beyond.
"We are obviously delighted that they see themselves as part of the future of the Ospreys, a cause they both care passionately for, and they have a desire to finish off the job they've started.
"Steve is a true stalwart of the region having served us so well as a player, and is a straight talker and natural leader. Having worked as a Development Officer for Bridgend and within our age grade system he has a real understanding of where our talent comes from.
"Gruff has a passion for skills development which is essential to our future as we look to continue bringing through young talent to represent the region."
Ospreys 'original' Tandy has been a part of the Ospreys set-up since the inception of regional rugby ten years ago, playing 102 times in the back row and scoring 10 tries, with his final appearance coming against Edinburgh in March 2010.
His first coaching role came within the Ospreys age-grade set-up while still a player, leading the U16 squad to the WRU Regional Age Grade Championship before taking up the role of Development Officer for the Bridgend District.
In 2010 he became Head Coach at Bridgend Ravens, leading them back into the Welsh Premiership at the first attempt. While at Bridgend, he combined his time with a coaching role at the Ospreys, first working with the B group of players at the region, and then as Technical Coach, stepping up to the role of Acting Head Coach in the LV= Cup prior to his appointment to the current role in February last year.
Having taken Glamorgan Wanderers into the Premiership in his first coaching role, Rees has developed a wide-ranging and impressive CV. He has been involved with the Ospreys since 2005, when as WRU Performance Skills Coach he played a major role in setting up the newly formed academies across Wales.
For the next five years, while still WRU contracted, his regional work was focused entirely on the Ospreys, initially on the development pathway helping to bring through a host of talent including names such as Justin Tipuric, Dan Biggar, Ashley Beck and Eli Walker. In 2008, his role was extended to encompass the post of Skills Coach to the senior squad as well as the monitoring and development of individual performance.
Away from the Ospreys Rees, was Assistant Coach at Neath between 2006 and 2008 as they recorded back to back Premiership titles, and has also worked with Wales Sevens and as Head Coach of Wales U18s. He spent the eight months prior to being appointed Backs Coach at the Ospreys last year working in Italy with PRO12 side Aironi.
Expressing his delight at extending his time in charge of his home region, Tandy said:
"I'm extremely happy to sign this new contract and I'm really looking forward to the future with this group of players. We've got a great base to work from, with an experienced core of real quality international players and British Lions, and some outstanding young talent that has come to the fore over the course of this season.
"With another year of experience under their belts, the potential of this group for next season and beyond is exciting. It's great that I'm going to be able to help them work towards reaching that potential and ensuring that the Ospreys remain competitive.
"It's been a difficult season in many ways, but when I look back at performances like the win over Toulouse or the game in Ulster when we went there without 26 players and a young team refused to be beaten and never gave up hope, getting a great win, then that is what being an Osprey is all about to me. That really excites me, as I think that this group can grow over the next few years.
"We are all about development from within and there's some great young talent coming through, supplemented by a world-class core to the team. The fans have really identified with what this group of players is all about and we've had some great crowds this year, something we can really build on."
Gruff Rees echoed Tandy's comments, saying:
"I'm extremely grateful to both the Ospreys and Steve for the confidence shown in me and these contract extensions allow us the opportunity to continue working together towards our aim of long-term sustainable success.
"There is enormous expectation and pressure on anybody working within the Ospreys set-up but I genuinely believe that we are well placed for the future with the changes that have been made here on and off the field over the last 18 months.
"In particular, it's been great to see so many younger players taking the opportunities that have been thrust upon them this season, and to see them thriving in the senior environment has been particularly satisfying.
"It's been an incredibly exhilarating 15 months since I started in the post, with the fantastic run to the league title last season an obvious highlight, but the ongoing challenges remain just as exciting as we keep building. Although we've had some difficult times this season it will stand us in good stead for the future, and knowing what I do about this group of players I'm excited about our prospects."
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