Scottish Rugby Chief Executive Mark Dodson said: "Alan is successfully building on the improved performances achieved by Edinburgh Rugby last season, which saw them reach the European Challenge Cup Final and secure the 1872 Cup.
"The club has made a positive start to the new season and we wanted to ensure Alan was able to continue to develop the vision he started in 2013. We are therefore very pleased he has committed to Edinburgh through to 2017."
Solomons set out to build a sustainable club through the medium of young indigenous and Scottish-qualified talent.
The green shoots of this vision are evident, as demonstrated during the course of last season when Sam Hidalgo-Clyne, Hamish Watson, Ben Toolis and Rory Sutherland established themselves in the Edinburgh team, with the first three gaining national recognition. Sam and Rory were joined by Dougie Fife and Damien Hoyland in being involved in either the summer series or RWC 2015.
This season has seen Damien Hoyland and Chris Dean become regulars in the Edinburgh team with 18-year-old Blair Kinghorn debuting against Zebre and Jamie Ritchie playing against Agen in the European Challenge Cup.
Alan Solomons said: "While we have made good progress over the past two seasons, we still have some way to go and I am pleased to be able to continue to build on what we have achieved."