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Kevin Blackwell has signed a one-year contract extension at Bramall Lane.
The deal will tie Blackwell to the Blades until 2012.
The news was announced by Blades directors Simon McCabe and Terry Robinson on Thursday with Blackwell signing the deal in front of the assembled media.
At the press conference, McCabe said: "We are are delighted to announce that Kevin has accepted a contract that will see him here until 2012. Congratulations to him and we are looking forward to continuing our relationship with him.
"This is a positive move for the football club when so many managers are feeling the pressure, we feel that offering Kevin this new contract is a good strategic point for the club."
Robinson added: "Kevin is a breath of fresh air to the club, he has a plan which he has put in place and the club is going to grow. We know he is going to achieve the goal we are all aiming for and he has the full backing of the Sheffield United board and plc."
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