Jones is now under contract with the CFL club through 2020.
“We are pleased that we have reached an extension with Chris,” Riders president/CEO Craig Reynolds said in a statement. “Under Chris’s guidance, the team has improved year over year and developed into one of the league’s top rosters.
“We are excited for what’s ahead for our football team.”
Jones will enter his fourth season with the Riders.
The move comes after Jason La Canfora of CBS Sports said at least two NFL teams had “done extensive research” on Jones.
Jones, 51, of South Pittsburgh, Tenn., joined the Riders in 2016 after leading the Edmonton Eskimos to a Grey Cup title the year before as their head coach.
The Riders have steadily improved under Jones, registering five, 10 and 12 regular-season wins in each of the last three seasons.
Saskatchewan finished second in the West Division this year with a 12-6 record before losing 23-18 to the Winnipeg Blue Bombers in the conference semifinal minus starter Zach Collaros.
Still, Jones was named the CFL’s coach of the year for the first time in his career.
In five CFL seasons, Jones has compiled a 53-37 regular-season record and is 4-3 in the playoffs.
Jones has won four Grey Cups over his CFL coaching tenure with Montreal (2002), Calgary (2008), Toronto (2012) and Edmonton.
The Riders have also signed assistant vice-president of football operations Jeremy O’Day to an extension through 2020. The club also signed Paul Jones two a two-year deal as assistant GM.
Director of football administration Mike Davis and football operations co-ordinator Jordan Greenly will also both return.