The 30-year-old's previous contract was due to expire in the summer of 2016, but he has now extended those terms by a further 12 months.
Speaking about his decision, the defender told the club's official website: "Joining Bayern was the best decision of my life. Everything here is good - the club, the team, the trophies we win and the atmosphere.
"Bayern is the right club for me and that's why I'm delighted to be staying in Munich until at least 2017. I'm certain this team can enjoy a lot more fun and success in the years to come."
Meanwhile, chairman Karl-Heinz Rummenigge added: "In just a year and a half he has emerged as one of our most important players both on and off the field. In the time Dante has been in the team we've won five domestic and international trophies."
Dante had recently been linked with a switch to Manchester United.