Care, who has made 116 appearances for the club, will now remain with the Aviva Premiership champions until 2016.
The gifted 25-year-old has won 33 caps for England and was named man of the match in the drawn third Test with South Africa in June, completing a timely reversal in fortunes.
Care had only just returned to the international fold following a series of alcohol-related incidents that threatened his Test future.
"For Danny to commit to us for this length of time is news that everyone at the club is delighted about," Harlequins director of rugby Conor O'Shea said.
"I'm looking forward to watching Danny's continuing development both on and off the pitch over coming seasons and to seeing him become the player that we all know he can be."
The most damaging moment of a turbulent six months saw Care banned from driving for 16 months and fined £3,100 after being arrested for drink driving in the early hours of New Year's Day.
That incident resulted in his exclusion from England's RBS 6 Nations campaign by head coach Stuart Lancaster.
Care was also fined £10,000 by Harlequins, on top of the undisclosed fine he received following his first arrest in December for being drunk and disorderly in Weybridge.
However, the former Leeds player announced in May he had given up drinking to get his international career back on track and was rewarded against the Springboks in June, scoring a try in the third Test.
"There is no other club that I want to play for so I'm pleased to extend my contract with Harlequins," Care said.
"I'm enjoying being part of a talented squad that is playing an attractive and successful style of rugby.
"Winning trophies is why we play professional rugby and having tasted some success in that regard, I would like more."