Keefe would be signed through the 2023-24 season. He will coach this season on the final year of his contract.
The 41-year-old is 62-29-12 since replacing Mike Babcock during the 2019-20 season. The Maple Leafs have lost their first postseason series in each of Keefe's two seasons.
"It's great for my family, of course, and all that, that part of it," Keefe said Friday. "But it hasn't changed anything in terms of my approach or anything like that. If anything, it allows me to just focus on doing my job as I can without any distractions or anything like that. That's what I have been doing."
Toronto was 35-14-7 last season and as the No. 1 seed from the Scotia North Division were eliminated by the Montreal Canadiens in the Stanley Cup First Round, losing the final three games of the best-of-7 series.
The Maple Leafs were 27-15-5 under Keefe the season prior, rising from fifth place to third in the Atlantic Division after a 9-10-4 start with Babcock. They were eliminated in the best-of-5 Stanley Cup Qualifiers in five games by the Columbus Blue Jackets.
"Just the way he gets the guys together (makes him a good coach)," Toronto forward William Nylander said. "And the system and the way he gets everybody to buy into how we've got to play and move on. I think he's great at doing that."
Toronto has not advanced in the Stanley Cup Playoffs since 2003-04 and has not won the Stanley Cup since 1966-67.
NHL.com staff writer Mike Zeisberger contributed to this report
