Hughes joined McLaren having spent two years with Mercedes as the German manufacturer's reserve and development driver during its time in Formula E before the operation was taken over by McLaren this season.
The Briton immediately impressed on his debut in Mexico City, qualifying third and challenging towards the front before finishing fifth.
He claimed pole in only his third outing in Diriyah and started on pole again in Monaco, where he led briefly before finishing fifth as he finished the season 12th in the drivers' standings.
"I'm really happy to be remaining with the McLaren Formula E Team for Season 10," said Hughes.
"The team has been my home for a number of years, and I have loved every minute of it. "We had a bit of a mixed season, but I had a lot of personal highlights which I'm hoping to build upon next year with the team and fight for wins and podiums, which I have no doubt we'll be able to achieve together. I can't wait for Season 10."
Hughes also set a world record ahead of the London season-finale when he posted a new indoor land speed record using a specially modified version of the Gen3 car in a head-to-head with Lucas di Grassi.
"I am excited to be able to share that we will be continuing our relationship with Jake," added McLaren team principal Ian James.
"Even though we never had any doubts about his performance, he impressed the team and the wider paddock with a great rookie season. Jake's commitment to the team and to Formula E is outstanding."
While McLaren confirmed on Thursday that Hughes would remain with the team next season, it announced on Tuesday that Rene Rast would be leaving the squad after just one season together.
The three-time DTM champion struggled during this year's campaign, securing only one podium finish in Diriyah, and finishing eight points behind Hughes in the drivers' standings.
A statement from the team read: "Rene has been an integral part of the team's successes and learnings in its first season as the McLaren Formula E Team.
"Rene has taken the difficult decision to pursue other opportunities, and the team fully supports his decision. We can't thank him enough for everything he's done for the team over the past year."
Although no second driver has yet been confirmed by McLaren, it is strongly believed that Briton Sam Bird will be announced shortly having lost his seat at Jaguar to Nick Cassidy.
