The 28-year-old, who was a part of Wales's 2009 Six Nations Championship squad, has made 44 appearances for the Falcons since joining in September 2012.
Fury has played a key role in Newcastle's rise back to the Aviva Premiership, while also impressing throughout this season.
Speaking to the club's official site, the Welshman said: "There is a great culture being created here at the club at present and I'm really pleased to be a part of it.
"The North-East public are extremely passionate about sport, and I can really feel that passion every time I play at Kingston Park. I'm looking forward to the challenge of competing for a regular first-team place."
The Falcons are currently 11th in the league table.