The 21-year-old graduate of the TFC Academy is in his second season with the first team.
"Ashtone represents the present and future of this club and he is an important player for us," head coach Paul Mariner said in a statement Thursday. "He is also a product of our Academy program and the current youth players can look up to Ashtone as an example of what the potential future holds for them."
The speedster has appeared in 29 league matches, starting 23 of those, and has five assists. Among those benefiting from Morgan's service is Dutch striker Danny Koevermans, who has scored in five straight games.
"It's excellent," Koevermans said recently of Morgan's delivery. "I hope the kid keeps going on like that. It's important for us, especially for me and Ryan (Johnson)."
Morgan attributes his recent success to feeling comfortable on the pitch.
"I think I'm in a zone right now," he said at a recent practice. "So it's been working for the team and for myself. It's been really good so far."
Asked if Koevermans had been buying him dinner recently, Morgan just laughed.
"No. It's great for the big man to be scoring. It's his job ... I'm here to help."
Morgan is making US$44,000 this season, according to the MLS Players Union.
Morgan earned his first cap for Canada as a substitute against Saint Lucia on Oct. 7. He made his first start against Saint Kitts and Nevis on Nov. 15.
The five-foot-11 165-pounder from Toronto was named the 2011 U-20 Canadian Player of the Year in December.
Morgan joined the Toronto FC Academy in its first season in 2008 at the age of 16.
He made his pro debut in 2010 against Arabe Unido in the CONCACAF Champions League. His first league appearance was as a substitute against Portland on March 26, 2011.
Toronto (2-10-3) plays at Philadelphia (4-9-2) on Sunday.