The 31-year-old has made over 450 appearances for the Liga outfit after progressing through their youth system and has put pen to paper on a new deal with his boyhood club.
Iraola, who has won seven international caps for Spain, expressed his delight at extending his stay at San Mames.
"I am happy, grateful to the club for giving me the opportunity to continue here," he said.
"I've been fortunate to be here for many years, I have had the confidence of all the technicians (coaches) who (have) been here.
"I will always be grateful to (Ernesto) Valverde (the current Athletic manager who gave Iraola his first-team debut in 2003) who gave me the opportunity to compete for Athletic."
Iraola has started all 15 of Athletic's Liga games this season, helping them to fourth place in the table.
