The 20-year-old, who has established himself as an automatic starter since joining Schalke in 2010 and has become a target for several major European clubs, turned down a multi-million euro offer from Zenit St Petersburg in August.
The hard-working Papadopoulos helped Schalke reach the Champions League semi-finals in 2011 when they also won the German Cup.
"I feel very well in Schalke and look forward to playing for the club for many years to come," he said in a statement.
The Greek defender was linked with a move to Manchester United in June during the European Championship. He admitted he was flattered to be tipped with a transfer to Old Trafford.
NEWS:Papadopoulos dispels Man United rumour
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