Sergio Perez is to stay at Force India for a fifth consecutive season in 2018.
The 27-year-old, who had been in the frame for a Renault drive before the French team committed to Carlos Sainz, said staying was an "easy decision".
Perez said: "Staying with Force India was always my priority. The team have allowed me to show my talents as a driver and I feel very happy here."
The Mexican added: "I'm proud of everything we have achieved and I think there is more to come."
Perez will again partner Frenchman Esteban Ocon, who was already contracted to the team for next season.
The pair have had a number of on-track incidents this season, but the team have threatened them with fines if there is a repeat - and the tense atmosphere between them seems to have relaxed in recent weeks.
Co-owner and team principal Vijay Mallya said: "Sergio has played an important role in our success story over the last few years. Since joining us in 2014, he has matured to become one of the quickest and most consistent drivers on the grid.
"His track record speaks for itself as the most successful Force India driver ever with four podiums. Alongside Esteban, retaining Sergio gives us stability going into next season and one of the most exciting driver pairings in Formula 1."
Force India finished in their best-ever position of fourth in the constructors' championship last year, and are on course to repeat it in 2017.
Team set for name change
The team are likely to change their name before next season in an attempt to present a more international image and make them more appealing to sponsors.
Co-owners Mallya and Subrata Roy have failed to attract significant commercial interest in their home country, where both are controversial businessmen who have both had legal difficulties arising from allegations of financial offences.
One option for a new name is Force Racing, but deputy team principal Bob Fernley said there had not yet been a final agreement.
The move, which is expected to get the required approval of other teams and governing body the FIA, is likely to be finalised over the winter in time for the start of the build-up to next season.