The 36-year-old Nabokov agreed to terms Wednesday with the Islanders on a one-year, $2.75 million extension that will keep him from becoming a free agent this summer.
Nabokov was claimed on waivers by the Islanders last season, after he finished playing in Russia's KHL, but he decided against joining New York because he wanted to play for the Detroit Red Wings, with whom he had signed a deal.
Instead of letting him out of his contract, the Islanders held on to him, and Nabokov joined the team for this season. He has played quite well, despite being on a team that is 14th in the 15-team Eastern Conference.
"I'm thrilled to commit to this team for next season," Nabokov said in a statement. "We have a great group in the locker room of young, talented players and we're heading in the right direction. I'm excited to have the chance to help get this team back to the playoffs."
Nabokov, who is earning $570,000 this season, is 17-18-3 with a 2.56 goals against average and a .912 save percentage in 40 games for New York, which has again been without No. 1 goalie Rick DiPietro for the majority of the season. Nabokov ranks 22nd on the NHL list — and fourth among active goalies — with 310 career wins, mostly while playing with the San Jose Sharks.
"Evgeni has proven that he can still play at an elite level in the NHL," Islanders general manager Garth Snow said in a statement. "He's given us a chance to win every night and we're excited to have him back for another season."
In January 2011, the Islanders suspended the Russian goalie for not reporting to the team after he had been claimed off waivers.
Nabokov had signed a one-year deal with Detroit, but the NHL's collective bargaining agreement states that anyone who plays in a professional league before signing an NHL contract must clear waivers. Nabokov, who played with San Jose for parts of 10 seasons, had spent last season with SKA St. Petersburg of the KHL.
He never played a game with the Red Wings.
The Islanders could have kept him out of the NHL this season had he again failed to report and play out the final year of his deal. Nabokov was disappointed that he was denied the chance to join the playoff-bound Red Wings and forced to go to the also-ran Islanders.
Now the two-time NHL All-Star is happy to stay.