The 23-year-old England centre has spent his entire playing career at Headingley Carnegie after coming through the Rhinos' academy ranks, and he has now agreed to remain put until at least the end of the 2019 Super League season.
"I never wanted to play for any other club than Leeds and I am pleased we have been able to agree a new deal that keeps me here for the future," Watkins, who has scored 72 tries in 128 appearances for the Yorkshire outfit, told reporters.
"I have got a young family and the chance to be part of this team as we develop over the next few years is something I am very excited about. The cup final last season was very special and it has whetted the appetite for what is to come in 2015.
"We have got a tremendous group of players at the Rhinos and a great coaching team and together I think we can achieve even more over the next few years. The last decade has been an incredible time for the Rhinos and it has been special to be part of that. Our challenge is now to build on that and continue that period of success in the years to come."
Watkins played his part in England's 32-26 victory over Samoa in their opening game of the Four Nations last weekend.