The 27-year-old Argentina international has made 24 appearances for Sarries since joining the club from Montpellier in the summer of 2014.
"He is one of the best scrummagers in world rugby," Saracens director of rugby Mark McCall said.
"He has shown great character to battle back from injury to get back to the form we know he is capable of."
Saracens have not disclosed the length of Figallo's new deal at Allianz Park.
Saracens prop Juan Figallo has signed a "multi-year" extension to his contract with the Premiership champions.