The Englishman has been with the south coast club since they were in League One, having moved from Brighton in 2012 for a mere £170,000.
Cook, who played every match in the Premier League for the Cherries this season, was delighted with the outcome.
He told the club website: "Myself and AFC Bournemouth have been the perfect match.
"Since the manager came in, things have been forever moving upwards and that has matched my own ambitions.
"These are exciting times to be at the club and, hopefully, we can continue to have as much success as we have had in the past few years."
Manager Eddie Howe also expressed his happiness at securing the defender for a considerable amount of time.
"This new contract is fully deserved after the season Steve has had," said Howe.
"He has developed into an outstanding defender, has shown great consistency and has proved himself capable of playing at the very highest level.
"I am delighted Steve sees his long-term future at AFC Bournemouth because he is a major part of our plans going forward."