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Wilkinson has amassed over 300 points for Philippe Saint-Andre's side since his move from Newcastle in the summer of 2009 and helped his side to the final of the European Challenge Cup last season.
Speaking last week before confirmation of the new deal Wilkinson emphasised how happy he is in the South of France.
"I am happy where I am, it fits the bill for me," he said.
"For me, in my situation at the moment, my main aim is to keep getting better and I made a move a year-and-a-half ago to try to continue to do that.
"I want to carry on doing that now. I am enjoying the experience and I'm learning a hell of a lot. I owe a lot to these guys."
In an extremely competitive Pool 3, Toulon host double European Champions Munster in Round 5 on Sunday January 16, before their final Pool fixture away to London Irish in Reading the following weekend.
