The 26-year-old scored 23 goals in 48 appearances last season as the Dons won promotion to the third tier via the League Two play-off final.
"Neal Ardley's style of management, his philosophy, and his ethos is the reason for me signing this contract," Taylor told the club website.
The Dons have not disclosed the length of Taylor's new deal at Kingsmeadow.
AFC Wimbledon striker Lyle Taylor has signed a new contract with the League One club.