The 18-year-old wonderkid has agreed a deal until the summer of 2020, with the option for a further year.
Fosu-Mensah joined United in 2014, and made his first-team debut last season
He has gone on to play 12 times for the Red Devils, and is regarded as one of the highest rated youngsters in the United youth system.
A versatile player, Fosu-Mensah has impressed in both defence and midfield, and looks to be adept at playing any position required of him.
He featured as a right-back in United’s run to the FA Cup final last season, but has also played in the centre of defence and as a holding midfielder, whilst the youngster impressed in a box-to-box role and as a number 10 in academy matches.
Speaking following the announcement of the news, Fosu-Mensah told the official Manchester United website: “I am delighted to have signed a new contract here at Manchester United.
“I have enjoyed every minute since I joined this great club and I want to continue the progress that I feel I have made so far.
“I am learning every day from the manager and the coaching staff. I appreciate the trust that the club has in me and I want to repay that with my performances on the pitch.”