The 31-year-old scored 21 goals in 29 Ligue 1 appearances during the 2016-17 campaign as Monaco landed their first league title since 2000.
The former Manchester United and Chelsea striker also netted five times in the club’s run to the semi-finals of the Champions League, and has revealed his delight after penning a fresh deal with the principality outfit.
“I am happy to continue my adventure at AS Monaco,” Falcao said in a statement. “After this incredible season where I found all my motivation, I had only one desire: to prolong this beautiful story!
“I am confident that this project will be just as exciting next season with the desire to aim for the best.”
Falcao initially joined Monaco from Atletico Madrid in 2013, but scored just 13 times for the Ligue 1 club before moving to Man United on loan in the summer of 2014, and then Chelsea one year later.