The Denmark international played every moment of all forty six league video games as Leicester received the Championship title with a document 102 factors.
The 27- yr - old was in inspired sort for Nigel Pearson's side conceding just 43 ambitions - a defensive document only bettered by Burnley and Brighton.
" I am immensely proud to indication for this fantastic club once more," Schmeichel explained to the club's web site.
"Leicester has felt like residence because the day I arrived three a long time back and constantly felt like the right option for me.
"I was always assured my long run would be sorted when we attained our objective of profitable marketing to the Premier League and I might like to thank the homeowners and the manager for making it take place.
"I are unable to hold out to participate in for this club in the Leading League. With the management staff we have and the squad currently in this article in addition new additions arriving, we have received a wonderful probability of obtaining a excellent season."