The Packers have not disclosed terms of the deal, but a league source confirmed to ESPN NFL Insider Adam Schefter that Nelson signed a four-year extension worth $39 million.
"It's exciting, obviously it's something everyone wants to get done, especially like I said a while back about training camp," Nelson said. "My wife and I are excited to be here, and hopefully I'll be able to finish my career here, finish this out and be done."
Nelson's new deal also includes an $11.5 million signing bonus, the source told Schefter.
"Jordy's hard work and dedication has made him a good player, teammate and a core member of this team," Packers general manager Ted Thompson said in a statement. "We are pleased to come to an agreement that will extend his Packers career."
The 29-year-old Nelson is coming off the most productive season of his career in 2013, when he had 85 catches for 1,314 yards -- both career highs -- and eight touchdowns.
"Jordy Nelson is an outstanding football player and a great ambassador for the Green Bay Packers," said coach Mike McCarthy. "Obviously an excellent family man. It's something that everybody's excited about and [I'm] glad to see Jordy will be here for some time. I was just made aware of it on the field. Hey, Jordy's so consistent and he shows up each and every day, performs at a very high level consistently and he's the ultimate pro."
McCarthy said he found out about the deal midway through practice, when Thompson came up and told him.
"It's fun to see Jordy re-sign for four more [years]," said quarterback Aaron Rodgers. "I told him that that's five for him and I've got six left, so we're going to have to do one more after that and stick around a little bit longer."
Nelson has 4,590 receiving yards and 36 touchdown catches in his six-year career, spent entirely with the Packers.
NFL.com reported the terms of Nelson's contract extension earlier Saturday.
Nelson was scheduled to make approximately $3.5 million in 2014 -- the final year of his previous contract with Green Bay.
ESPN.com Packers reporter Rob Demovsky contributed to this report.