The 23-year-old joined the Rossoneri from Manchester City at the end of the January transfer window last year, and believes that they are in a better position now than when he first arrived.
"I am happy to play for this great team, especially in difficult moments, because anyone can get through easy times. It's in the difficult ones that it's tough to get the best out of yourself," he told Milan Channel.
"Now we find ourselves in a better situation compared to a while ago, as we are slowly pulling ourselves out. I am truly happy to be here, had a wonderful year with the Rossoneri and hope to continue like this."
Balotelli has scored 13 goals in all competitions for Milan this season.