The 21-year-old joined from Halifax in June 2016, but has spent much of his time out on loan having made just three appearances for Hull FC.
Rawsthorne, who is currently on loan with Leigh Centurions, said: "It's what I've worked for ever since I signed and it's big for me to get the new deal.
"Now it's about setting myself some new goals and making a push to play more games in the first-team."
Head coach Lee Radford said: "I am really pleased. It is great news for us. The coaching staff have been really impressed with his development this season."
Versatile Hull FC back Nick Rawsthorne has signed a new two-year contract.