The 29-year-old, a member of England's 2003 World Cup-winning side, is now set to stay at Kingsholm until at least 2011.
Tindall said the emergence of a new generation of talent was central to his decision to commit himself to the Cherry and Whites.
"I am enjoying my rugby as much as I ever have. Seeing the likes of Ant Allen, James Simpson-Daniel and Ryan Lamb and the things they can do is fantastic, it is keeping me young," he said.
"It is just great to be involved with a club which plays rugby the way we do. It gives players freedom to express themselves and I think that is why we are being successful.
"There is so much we want to achieve as a group of players that I personally want to see this job through. We have only really just scratched the surface of what we can achieve and that is important to me."
Tindall joined the club from Bath in 2005 and helped them to the 2006 European Challenge Cup.
They also topped the Guinness Premiership at the end of last season, although by the time they lost the play-off final to Leicester, Tindall had already been ruled out by a broken leg - an injury which also kept him out of the World Cup.
He has scored three tries in 13 appearances this season.
Tindall added: "It took me a bit of time to settle when I first joined the club but now I couldn't imagine playing anywhere else.
"I am happy and settled and that is important for me personally and to get this extension sorted is great.
"We can take a great deal from our start to the season but there is a long way to go and we must learn from recent mistakes to become an even better side."
Gloucester head coach Dean Ryan added: "Mike is a guy who you can build a team around because his quality and experience speak for themselves.
"Mike has the respect of his colleagues and team-mates, he has an all-round game that can operate under scrutiny in all conditions and I am thrilled he has re-signed with us."