The defender has committed to the club until summer 2029, with an option for an additional year.
Ballard has enjoyed an impressive debut Premier League season, having been pivotal in the Black Cats’ memorable promotion-winning campaign.
Since joining in June 2022, the 26-year-old has made 114 appearances in red and white, contributing eight goals, and has established himself as a key figure in the squad’s continued success.
“I’m absolutely delighted to have signed a new contract. From the moment we began talks, it felt like an easy decision, and I’m happy to be extending my time at the Club,” Ballard told club website.
“Achieving promotion last season was incredible, and I feel very fortunate to have played a part in some special moments in the Club’s recent history.
“My aim this season was to stay in the team, compete every day, and keep working hard to contribute. Hopefully, I can continue improving and help drive the Club forward for many years to come.”