The extension reportedly includes a player option for the 2024-25 season when James will be in his 40s.
James will become the NBA’s highest-earning player in league history with $532 million in career guaranteed money.
The 37-year-old forward was entering the final year of his contract with the Lakers who missed the playoffs last season.
James is ineligible for a no-trade clause as he has agreed an extension, not a new deal, but he has a 15 percent trade kicker.
All that means is he’s likely to remain with the Lakers, although he has previously spoken about his desire to play with his son Bronny, who is draft eligible in 2024.
James averaged 30.3 points, 8.2 rebounds and 6.2 assists in the 2021-22 season but he was limited by injuries.
The Lakers struggled throughout the campaign despite the off-season addition of Russell Westbrook, missing the postseason with a 33-49 record.
Head coach Frank Vogel has been moved on, with Milwaukee Bucks assistant Darvin Ham taking over.
James and Vogel had led the Lakers to the 2019-20 NBA title but the side have struggled since, eliminated in the first round playoffs in 2020-21.