The Brazilian joined from Almeria ahead of the 2011-12 campaign, with his previous deal having been set to expire in 2015.
And Alves, 29, has now agreed to extend his stay at Mestalla for an additional four years.
"Valencia CF are pleased to announce the reaching of an agreement with goalkeeper Diego Alves to extend his contract at the club through to June 30th 2019," read a statement on Valencia's official website.
"Diego Alves... participated in a total of 35 games in the most recent campaign.
"He was chosen by fans on the club's official social networks as the best player of the 2013-14 season."
Last week, Valencia appointed Nuno Espirito Santo as their head coach after the club's new board opted to part company with previous boss Juan Antonio Pizzi.
