The veteran striker was expected to leave when his previous deal expired this summer, however he has now committed for a further 12 months.
Giroud told the Guardian: “Time is not playing on my side, I'm almost 34, but my body is ready to play a few more years at high levels.
"I was about to leave the club but I really didn't want to. I needed to play for the European Championships and I was ready for a new challenge.
"(Frank) Lampard? When he told me I was going to have a better chance, I just trusted him and I really want to fight for it, like I did before at Arsenal.
"It seems like a new start, I want to win more trophies with Chelsea."