The 20-year-old, whose initial deal was due to end after Saturday's match with Plymouth, said last week that he would be keen to remain at Adams Park.
Wycombe boss Gareth Ainsworth has said that he is pleased to secure Knott's services for a further two months.
"Billy typifies what we're trying to do here," Ainsworth told the club's official website.
"He's settled in and got into the spirit immediately, and the way he plays makes it evident for all to see just how much he wants to win and how much he wants to be a part of this.
"I had no hesitation in extending his loan once Sunderland agreed. I'm very grateful to Sunderland for allowing us to have Billy here for longer. Hopefully we can improve him as a player and he can improve us a club, that way everyone's a winner."
Knott has made four appearances for the Buckinghamshire side.