The England pace bowler, who has represented his country 73 times in all formats, is the latest to recommit himself to the club after Gary Ballance, Steve Patterson and Jack Brooks recently signed extended deals.
“It’s my fifth season at the club, and I joined at the same time as Jack Brooks,” said Plunkett. “Since I joined, we’ve enjoyed nothing but success and it’s been good fun. We see last year as a blip and hopefully we can win the league this time around.”
Plunkett, 32, is currently sidelined with a calf injury sustained prior to representing MCC in their Champion County match against Middlesex.
He hopes to be back in action before the end of the month.
“I’ve got a bit of a niggle at the moment, but hopefully I’ll be back fighting fit in the next couple of weeks,” he said.
“I love Yorkshire, the surrounding area and the passion that the people here have for cricket.”
Martyn Moxon, Yorkshire’s director of cricket, said: “He’s obviously doing well with England’s limited overs squads and it’s good that we’ve been able to keep him until the end of 2018 and help us continue our successful period.
“There’s still a lot of cricket left in Liam and hopefully he can help us keep winning competitions.”