The 28-year-old has played in 20 matches for the capital side this season, scoring two tries.
He said: "It's exciting times at the moment and I'm pleased to have signed again.
"Between the ages of 27 and 30 it is thought that you are in your prime so I wanted to stay with Edinburgh for that period of my career and give as much as I can to the team.
"I'm looking forward to next season's Celtic League and we are the top Scottish seeds for the Heineken Cup.
"It's a great squad - a lot of us joined at the same time so I've got some really good friends here."
He produced arguably his best performance during his nine caps in the 18-12 Calcutta Cup win over England.
Edinburgh coach Todd Blackadder added: "It's great that Marcus has re-signed and committed his future to the Edinburgh Gunners. The autumn internationals provided a good platform and he showed his quality through the Six
"He's still young and I think he can reach his full potential in the next few years so it is exciting times for him. This is a very positive signing for Edinburgh at the moment."
Edinburgh have also signed Scotland Under-21 scrum-half Greig Laidlaw on a two-year deal.
The 20-year-old said: "I am really pleased to have signed with the Gunners. They have been the top Scottish side this season and have some quality players. I'm looking forward to getting started and working with guys like Mike Blair."