Worcester, who reached the semi-finals of last year's European Challenge Cup before losing out to eventual runners up Bourgoin, face reigning Guinness Premiership Champions Leicester Tigers this afternoon before beginning their European campaign against Montpellier next Thursday.
And Ruddock's decision to commit himself to the ambitious English outfit has unsurprisingly been welcomed by chairman Cecil Duckworth.
"I'm very pleased that Mike has agreed a new deal at Warriors and that he can now continue his fantastic work at the club beyond this season," said Duckworth.
"With Mike at the helm, we have witnessed the development of a squad full of exciting young English talent at Sixways Stadium.
"He has mixed them with an exciting blend of experienced international stars and this season we believe the team is showing its true potential as we compete in both domestic and European competitions.
"Mike has not only brought a fantastic amount of enthusiasm, passion and dedication to his role but also developed and instilled a truly professional attitude and ethos at the club in everything we do."
As well as leading Wales to a first Grand Slam in 27 years in 2005, Ruddock previously guided Swansea to two Welsh league titles in 1992 and 1994 and the Welsh Cup in 1995. The 50-year-old former Wales B back row has also enjoyed spells coaching Leinster, Ebbw Vale, the Dragons, Barbarians and the World XV but had no doubts about committing to Worcester.
"Worcester Warriors is a fantastic club with a brilliant chairman, an outstanding fan base and dedicated group of professionals on the playing staff," said Ruddock, who led the Warriors to the 2008 Challenge Cup Final in his first season in charge.
"I'm hoping that our good form of late will continue over an extended period as we continue to develop our squad strength and consistency. Over the last two years we've been building a squad that we believe will be capable of making a bigger impact.
"During that time we have given opportunities to a number of players who have come through our excellent academy structure. We have also signed world class stars including Chris Latham, Rico Gear, Sam Tuitupou and Greg Rawlinson, players who have helped to establish the Warriors brand globally.
"Our goal over the next two years is to keep improving as a team and strive to challenge for a place amongst Europe's elite."