The 28-year-old became the Terriers' then-record signing when he joined from 1860 Munich two years ago, helping them to promotion to the Premier League in his first season.
Schindler's existing deal was due to expire in two years, but the new deal will keep him at the club until 2021 with the option of a one-year extension.
"We all knew that Schindy was a top performer after his first season at Huddersfield Town, but his quality really shone through as we played in one of the best leagues in the world last season," manager David Wagner told the club's official website.
"We're absolutely delighted that he has signed this new contract at the club. It's as good as any news or incoming that we had success with during the summer transfer window.
"As well as being a superb player, he is a top character in the dressing room too, a real leader."
Schindler was a key player for Huddersfield for their debut season in the Premier League last term, featuring in all but one of their games.