John Buchanan was reappointed on Friday as Australia coach through to the 2007 World Cup in West Indies.
Buchanan's job had been under review after Australia's Ashes loss in England but Cricket Australia chairman Bob Merriman said the board had agreed to extend his contract.
"The Australian Test and one-day teams are ranked number one in the world and we are pleased their on-field success will continue to be supported by John's off-field expertise," Merriman said.
"Australia has an exciting summer coming up, we also want to do in 18 months what England has done in winning the Ashes. We want them back in 2006-07. We are then due to defend the World Cup."
Buchanan, 52, took over the national coaching position from Geoff Marsh in 1999 and said he was looking forward to continuing in the role.
"I am very grateful to be offered the opportunity to continue the work we have been doing and to continue to be associated with the team," Buchanan said.
"We have our work cut out after the disappointment of the Ashes series but I have been delighted at the way players, team personnel but in particular the Australian public, have rallied behind the cause of ensuring we remain number one."
