Talented back rower Thomas Anderson will also come on board for the next two years, after signing from Ulster.
Wilkinson joined Connacht in 2006 and quickly slotted into the team, making his mark with his powerful scrummaging and excellent ball-carrying skills.
Originally from Grahamstown in South Africa, the 27-year-old prop qualifies to play for Ireland through residency and in 2009 was called into the Ireland Wolfhounds side to face Tonga.
He marked that occasion with a third minute try and went on to earn a further cap that year against the Argentina Jaguares, along with appearances against England Saxons and Scotland 'A' in 2010.
In October of last year, 'Wilko' won his 100th cap for Connacht and in doing so joined current team-mates John Muldoon, Gavin Duffy, Johnny O'Connor and Michael Swift in the '100 club.'
Commenting on his contract extension, he said: "Connacht has been my home for the last five years and it's great to be able to commit for another two years.
"I'm delighted to have played for the Ireland Wolfhounds and I would love to make the next step and represent Ireland at senior level, but at the moment I am concentrating on being the best rugby player I can be and helping Connacht make their mark in the Magners League."
Meanwhile, the 24-year-old Anderson will join Connacht at the end of this season on a two-year deal. Anderson has been capped 18 times in the Magners League in his three years with Ulster and has been a regular in the Ulster Ravens side, captaining them in the British & Irish Cup.
The Magherafelt-born forward was part of the Ireland Under-20 team that won the Grand Slam in 2007. That Ireland side, which was coached by Eric Elwood, also included current Connacht players Andrew Browne, Jamie Hagan, Ian Keatley, Shane Monahan and Aidan Wynne.
Speaking about his move, Anderson said: "I'm really looking forward to the new challenge. It's going to be tough leaving Ulster, but that's the nature of the game.
"Hopefully I can show what I can do in the Magners League and take my chance with Connacht. Up here it's been tough, you have a Lion in my position in Stevie Ferris. He's a cracking player, he needs his game-time and unfortunately I've been behind him.
"I want to go down there (to Connacht) and show what I can do at Magners League level, show my ability and that will give me more confidence with a couple more starts.
"I got a start against Munster recently and showed what I could do. I got another start against the Scarlets and felt I rose to the occasion. I think if I continually get that, week in, week out, hopefully down in Connacht, that's where I'll improve my game ten-fold."