The 38-year-old joined the Club in 2019 and has now agreed to a further 12 months at the Etihad Stadium.
He originally arrived on loan before completing a free transfer in the summer of 2021.
Having made his senior debut for Leeds United all the way back in January 2004, Carson will now continue his career into a 21st season as a professional.
The experienced goalkeeper’s debut for City came in the May 2021 victory at Newcastle United before a second appearance in the Champions League round of 16 second leg with Sporting CP in 2021/22.
“I’m looking forward to another season as part of this incredible squad at City,” said Carson.
“Every day I work hard and learn something new from Pep, Xabi Mancisidor and the world class group of players.
“Hopefully I can continue to help our goalkeepers perform at their best as we challenge for even more trophies.”
Director of Football Txiki Begiristain said: “Scott has been important to our successes over recent seasons, supporting his team-mates and training hard as part of our excellent goalkeeping unit.
“We’re very pleased he has agreed to extend his contract. Hopefully he can help the squad and be ready when called upon on the pitch in the 2024/25 season.”
Everyone at the Club would like to congratulate Scott on signing his new deal.