McLaughlin, who scored his third win of the season last Sunday at Portland, arrives at the 2022 season finale at Laguna Seca lying fifth in the championship and still mathematically in title contention.
He has made a huge leap in performance this year and, while he won the 2021 Rookie of the Year honours, the three-time Supercars champion was only 14th overall.
The New Zealander won this year's season opener at St. Petersburg, and also took the spoils at Mid-Ohio in July.
Team Penske president Tim Cindric said: “Scott took a big gamble when he came to IndyCar, as he knew he would be leaving a series where he knew he could thrive for years to come.
“To see him have the success he has had so far has been really satisfying, as we were confident in his talent. We just didn’t know how long it would take for him to gain the confidence in himself.
“Scott has adjusted quickly and has already established himself as someone that can win at any track during one of the most competitive eras of IndyCar racing.
"He continues to be a great representative for our partners and connects well with race fans all over the world. We are excited that he will continue to be part of the Team Penske legacy for years to come.”
McLaughlin, who racked up 56 wins for DJR Team Penske in Supercars, said: “Team Penske has been such a huge part of my career, helping me get to where I’m at today, so I’m excited to continue racing with Roger [Penske], Tim and the entire team well into the future.
“Getting a chance to move to the United States and chase my racing dream, driving in the IndyCar Series, is something that would not have been possible without Team Penske, so I’m forever grateful. '
"I’ve had so many great moments with this team, from winning three Supercars Championships to winning the Bathurst 1000 to making my first IndyCar start.
“Now, we are competing at a high level, winning races and poles and even competing for the series championship. I can’t wait to see what the future holds with Team Penske.”
