The Italian has signed a new two-year contract with the Welsh outfit having initially signed a half-season deal when he took over in January.
The Swans were just a point above the bottom three when he was first appointed and the Italian has won seven of his 15 matches in charge, with Swansea climbing up to 11th with one match of the season remaining.
"Francesco fully deserves the chance to continue his good work into the new campaign," Swans chairman Huw Jenkins told the club website. "He was prepared to come into the club at such a difficult time and put himself in a pressure situation with the club fighting for survival.
"He has achieved the goal of securing top-flight football for this club with plenty to spare and has earned the right to start afresh next season. It's going to be another challenge for everyone, but we are looking forward to seeing how far he can take this squad of players over a full season.
"We are confident that he can carry on the good work at the end of this season into the new campaign."
Guidolin, 60, had to overcome a chest infection in March that saw him hospitalised and miss three games of the campaign.