The 27 year old Slovakia international was pictured on the Liverpool website signing the contract with managing director Ian Ayre at the club's Melwood training ground. The Reds have given no details of the length of the deal.
Skrtel, who was voted the Anfield club's player of the season in 2011-12, said: "I'm happy because I am a part of one of the biggest clubs in the world.
"After last season there was a lot of talk about my future but I have to say that the first priority for me was always to sign a new deal with Liverpool.
"I hope I can create history at this club and that the fans will always remember me - that's my target for the future."
Skrtel, who has made 175 appearances for the Merseysiders, said: "I have been here almost four and a half years and I have enjoyed that time here - myself and also my family.
"So there were no questions about whether to stay or to leave.
"A lot of things have changed, a new manager has come. I think we can start to make history and I want to be a part of that history.
"We have our target. For this season it is the top four and I hope we can do it. Then we will see."
Of his own performances he said: "You can always play better.
"I can say the last two seasons were really good for me - probably the best two seasons of my career.
"If I can repeat the performances of the last two years this season I can be happy."