Donaldson, 24, has scored one try in 37 appearances for Hull KR since joining from Bradford Bulls in 2014.
"He is a consistent performer and a real professional who works hard to improve his game," Rovers director of rugby Jamie Peacock said.
"At the age of 24, he has his best years ahead of him."
Hull KR forward James Donaldson has signed a new one-year deal to stay at the club until 2017, with an option to extend the contract by a further year.