Lupul is now signed through to the 2017-18 season. Sunday's deal comes a day after Lupul was picked as one of the Leafs' alternate captains.
The 29-year-old played 66 games last season and ranked second on the team in goals (25), assists (42), points (67) and power-play goals (8). He had career highs for assists and points.
Lupul has 151 goals and 172 assists in 517 games with Toronto, Anaheim, the Philadelphia Flyers and Edmonton Oilers. The Fort Saskatchewan, Alberta, native was originally selected seventh overall by the Ducks in the 2002 draft.