The 21-year-old has been an ever-present in the Saddlers side this season, scoring twice in 30 games.
The right-back, whose only Premier League appearance came two years ago, spent most of last season on loan at Wycombe Wanderers in League Two.
"He really believes in what we're doing for him and it's been great watching him develop," boss Jon Whitney said.
"He's shown trust in me, like I've shown trust in him, and he feels he will continue to develop as a player and a person with another spell at Walsall," the Saddlers boss added to the club website.
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Southampton's Jason McCarthy has extended his loan spell at League One Walsall until the end of the season.