Manchester United were keeping tabs on the Germany international, but he has committed to stay with Dortmund under new coach Thomas Tuchel until June 2017.
In April, United were reportedly close to agreeing a ??21.5million deal which would see Gundogan move to Old Trafford.
Dortmund at one point confitmed that Gundogan would not sign a new contract but last week his agent and uncle, Ilhan Gundogan, admitted staying at Dortmund was ???clearly an option again???.
And the 24-year-old midfielder is already looking ahead to the new season under their new management.
???The first days of pre-season are over and it???s been fun to work with the coaches and my team-mates,” the Dortmund midfielder told the club’s official website.
“I’m happy that we finally have clarity and I can continue playing football for Borussia Dortmund. I???ll turn my focus immediately to preparation ??? in August we want to attack fully again.???
Sporting director Michael Zorc said: ???We???re pleased that Ilkay will continue to play for Borussia Dortmund. I’m confident that he will play his part so that we can reach our sporting goals.???
Gundogan returned to a regular spot for the club last season after returning a back injury which restricted him to just three Bundesliga appearances in 2013/14.
He went on to feature on 33 occasions in the most recent campaign, scoring three goals.