Elliott was due to come off contract at the end of this season, but his new deal will run until the end of 2025.
The 29-year-old has been in scintillating form in recent weeks.
He kicked the match-winning goal after the siren in the round 19 win over Essendon, and four goals against Melbourne last Friday to inspire Collingwood to a seven-point victory.
Elliott has notched 220 goals in 150 games, including 21 in 14 appearances this season.
"We're pleased to extend Jamie for another three years, and to hopefully see him play out his career at the club," Collingwood's general manager of football Graham Wright said in a statement.
"Jamie is an instrumental figure in our program. Across 11 seasons he has a wealth of football smarts which is invaluable to the youth of our group.
"The likes of Ash Johnson, Jack Ginnivan, Beau McCreery and Ollie Henry are products of great improvement credit to Elliott's influence in the forward line.
"In addition to this, Jamie is a player that stands up in the moments that matter, inspiring all members of our program."
Collingwood's stunning 11-match winning run has lifted them to second ahead of Sunday's crucial match with Sydney at the SCG.
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