The 21-year-old, who moved to the League One club last summer, has agreed fresh terms that will keep him with the Red Devils until 2015.
Walsh has said that he is pleased with life at the Broadhall Stadium.
"It wasn't a difficult decision because I am really happy at the club," he told Crawley's official website.
"I feel I have improved as a player in the time that I have been here. We've started the season well and we definitely feel as a squad that we can contend for the playoffs, so there is a lot to look forward to."
Walsh has scored six goals in 44 appearances for Crawley.