Tallis Duncan's ability to cover several positions has linked him with possible Australian selection for the 2026 Rugby League World Cup.
He was also named as a second-rower in the 2026 RLPA Dream Team.
South Sydney has now extended the 24-year-old's contract until at least the end of 2030.
Duncan had been expected to become available on the open market from November 1, with the PNG Chiefs reportedly interested in signing him for 2028 and beyond.
That prospect raised the possibility he could join veteran winger Alex Johnston in Port Moresby, but Duncan will remain with the Rabbitohs.
Despite his value to the club, salary-cap pressure had created concern he could be squeezed out.
South Sydney has several stars coming off contract at the end of 2027, while Payne Haas is due to arrive next season.
"I'm really happy to be staying at Souths, I love this club and this is my home," Duncan said.
"I've grown a lot since I first came to the club and I'm grateful for everything Souths has given me.
"Putting on the Souths jersey means a lot to me, and I'm excited for what's ahead."
David Fifita, Latrell Mitchell, Brandon Smith, Jack Wighton and Campbell Graham are among the other Rabbitohs set to become free agents on November 1.