The 23 year-old former Currie High School and Currie RFC player joined the club's elite development programme (EDP) in the summer of 2011 and has become a familiar feature in the back division for club and country over the past two seasons.
He joins fellow Scots caps David Denton, Alasdair Dickinson and Greig Tonks in extending his contract this season.
Speaking at the announcement, Edinburgh Rugby centre, Matt Scott, said: "I'm delighted to commit my future to Edinburgh Rugby, at a key time in my career, and at a club where a number of other senior Scotland internationalists have also signed on.
"I've made life-long friends at the club over the past few years and it's good that we're keeping a good core of guys that know how much it means to play for Edinburgh."
"That was key for me and I'm happy to be one of those guys and be part of building the club going forward."
He continued: "The coaches run a very tight ship. There's no ambiguity about the way they want us to play or the standards they set."
"As a young player developing that's the kind of place I want to be."
Scott represented every age-grade as he came through the region's player pathway and won his first cap for Scotland as an injury replacement in the 2012 RBS 6 Nations against Ireland in Dublin, while still an EDP player.
Since he announced his arrival, the powerful, playmaking centre has racked up 44 appearances for the club and 19 caps for his country, in spite of ankle and hand injuries disrupting his current campaign.
He has scored once in his three appearances for Edinburgh Rugby this season - in the club's home win over Munster in the Heineken Cup - and returned from the sidelines to feature for Scotland in the current RBS 6 Nations championship.
Speaking after the announcement, Edinburgh Rugby head coach Alan Solomons expressed his delight in securing the services of one the most highly-rated talents in the Scottish game.
"This is incredibly good news for us", said Solomons.
"Matt [Scott] is an outstanding young talent who has now established himself at international level."
"It's great to have a Scottish player of that calibre commit himself to the future of this club. I think it speaks volumes and sends out a very positive message."
"Matt is an exceptional athlete. He is a physical and powerful player who runs good lines and presents a real threat to the opposition."
"The time is probably right for him to play a greater role in the broad leadership group within the club and I think he will have much to offer in that regard, partularly for young aspiring Scottish players."
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