Matic joined United in 2017 and has made 114 appearances for the club. The Serbian international has represented his country on 48 occasions.
Nemanja Matic said:
“I am very happy that I will continue to be part of this great club.
“As a player, I still have a lot more to give and achieve in my career and to do that with Manchester United will be a huge honour.“This is a really exciting team to be part of, we have a good balance of youth and experience within the squad and there is great comradery amongst the group.