Madrid: "Valencia CF has reached an agreement with the coach of the first team, Nuno Espirito Santo, to extend his contractual ties with the club until June 30, 2018," said a statement on the club`s website.
The 40-year-old Portuguese became Valencia`s sixth coach in little over two years when he was appointed in early July.
However, with Singaporean businessman Peter Lim`s takeover of the club now complete, Valencia are hoping for a more stable future with a return to the Champions League next season the priority.
Victories over Real Madrid and Atletico Madrid in La Liga have been the high point of Nuno`s seven months in charge.
And they are well-placed for a top four finish as they currently lie fifth, just a point adrift of Sevilla in the final Champions League place.