The England international entered the last six months of his deal with the Gunners before agreeing fresh terms at the Emirates Stadium last month.
However, he admits that the continuing saga had a negative impact on his game.
"It was a long process and it was difficult for both sides. In the last two or three game before it was sorted it was playing on my mind more than it had been beforehand but I'm happy it's all done and I'm enjoying my football again," said Walcott.
"Things are going well. I'm working hard, staying after training and seeing what I can improve. I just enjoy working hard, scoring goals and trying to help make this team the team we should be. That was one of the main reasons for signing – there is huge potential in this team and I want to be part of it.
"I've been happy with the last couple of seasons, but this year has stood out. I've had a more consistent run of games, playing well, scoring goals. Things always go well when you're scoring, it's how you react when they're not going so well. At the start of the season I wasn't playing at all and I reacted in the right way on the pitch."
Walcott joined the North Londoners from Southampton in January 2006.