Shaw joined Jonny Wilkinson and co at the Stade Felix Mayol after the 2011 World Cup when he ended 14 seasons of association with London Wasps.
The 38-year-old former Bristol second row, who was the only player to earn selection for each of the last two Lions adventures to South Africa, will remain with Toulon until June 2013.
Shaw won't be involved in Friday night's Amlin Challenge Cup Final against Biarritz at The Stoop as he wasn't registered for European competition but he is expected to play a key role in his club's quest for the Top 14 title a week later.
Toulon host Racing Metro in the play-offs after finishing third in the regular season table meaning Shaw could add a French Championship crown to the Heineken Cup, English Premiership and Anglo-Welsh titles he won with Wasps.
Shaw will be joined by fellow Lion Gethin Jenkins at Toulon this summer, while 2013 Lions hopeful Steffon Armitage is already on the books with Bernard Laporte's men and brother Delon and London Irish lock Nick Kennedy are also joining them next season.