The 19-year-old left-back agreed a deal last year until 2019 but this extension takes him to summer 2021.
Tierney made his debut in May 2015 and went on to make 34 appearances in the last campaign, also winning his first Scotland cap in March.
"I'm obviously delighted to be here, my future is only here," he said.
"Last year was my breakthrough season so I need to prove myself again this season and hold down my place.
"But it's been crazy. I only signed a four-year deal 10 or 11 months ago, so getting a new deal already is great."
The Isle of Man-born teenager, a product of Celtic's youth system, was voted Scottish Premiership young player of the year.
And he admits new manager Brendan Rodgers had an impact on his decision to commit his long-term future to the club.
"He had a big influence," said Tierney. "He spoke to me after the first day's training and I've signed it [the contract] now. It's happened so quick and I'm delighted.
"He didn't really need to sell it to me as I wasn't really thinking about leaving at all.
"Everybody's expectations will be really high this year, but as a football player at Celtic you need to deal with that and I hope I can."
Tierney has been regularly linked with many of the top club's in the English Premier League, describing the speculation as "weird and unexpected".
With Scotland having missed out on the finals of Euro 2016, the full-back, who made his international breakthrough in a 1-0 win over Denmark, hopes he can help the country to future finals.
"Everybody wants to be playing in competitions like that so we need to just focus on the next competition now," said Tierney.
"You see any team can qualify, any team can do it and I believe Scotland has the talent."
Kieran Tierney said he never considered leaving Celtic after signing a new five-year contract with the Scottish champions.