The nine-year veteran was a CFL all-star last year after recording 36 tackles and two interceptions over 18 regular-season games.
"Ryan is one of the veteran players that we're counting on to show our defence and our team the kind of commitment, teamwork and selflessness it's going to take to be a champion," Lions GM Wally Buono said in a statement. "As a four-time CFL all-star, including last season, Ryan continues to play at a very high level and I believe his greatest season is yet to come."
The Seattle native hasn't missed a regular-season game since entering the league in 2005. His mark of 162 consecutive games played is the longest active streak in the CFL.
"I cannot say enough about Ryan's leadership and accomplishments during his time as a Lion," said head coach Mike Benevides. "He's been with us for the better part of a decade and we will be leaning on him not only as a key component of our defence, but also as part of our core leadership group."
Phillips has appeared in 13 playoff games and won Grey Cups with the Lions in 2006 and 2011.
"Signing this extension is very satisfying for me for a number of reasons," Phillips said. "Having an opportunity to play in front of my friends and family is very important to me and I'm grateful to the Lions for making that happen for years to come.
"I'm also honoured to play alongside some of the best defensive players in the CFL such as Dante Marsh, Cord Parks, Adam Bighill and Solomon Elimimian. We have a great team here and more specifically we have great defensive players that are not concerned with personal recognition but instead, simply winning championships."
Phillips is tied with former Lions great Norm Fieldgate with 388 career tackles and is second behind Larry Crawford with 666 interception return yards.