Smith had confirmed his intentions to join Aviva Premiership outfit London Irish earlier in the season but has since reversed that decision and agreed to remain at the Liberty Stadium.
"I'm delighted to have signed a new contract and to be staying at the Ospreys, my home region," said Smith, who made his first-team debut in 2007 and is just nine games short of hitting a century of Ospreys appearances.
"We had a fantastic end to the season, winning the league again in such dramatic fashion in Dublin, and I'm really looking forward to helping the team build on that success.
"We've got a young and exciting group of players together for next season and there's a great buzz about the place.
"There's a lot of hard work to do between now and the first game of the season but I'm looking forward to wearing the Ospreys jersey at the Liberty Stadium again."
Smith was a near ever-present in the PRO12 last season, only missing one of the Ospreys' 24 games as they became the first side to claim four Celtic League crowns.
The former Neath and Wales U21 star also captained the region on a number of occasions last term and chief operations officer Andrew Hore believes Smith symbolizes all that the Ospreys are about.
"It's fantastic news for the region that we have been able to secure Tom's services until 2015. He is a real Ospreys stalwart and his experience and leadership is an asset to the organization," said Hore.
"Over the last 12 months or so we've had to make some very tough decisions for the long-term good of the business. However, because we didn't shirk these challenges, we're now in a position where we are able to make decisions for the right reasons - rugby reasons.
"The move to re-sign Tom is an indication of the progress we've made and we all look forward to him continuing to have a real impact around our environment."