The payment company, which has sponsored the competition since 1994, has signed up as official partner until the end of the 2014-15 season.
MasterCard said it would use the extended deal to place a "renewed focus on the fans", including exclusive offers for cardholders through the UEFA Champions League MasterCard online store.
The brand said it would look to offer "bigger and better" experiences for fans based in cities where Champions League games take place. It will also enhance its social media activity around the tournament, in particular through its 'Witness History' Facebook page.
A MasterCard spokesman refused to confirm the value of the sponsorship deal.
Javier Perez, president of MasterCard Europe, said: "We are delighted to announce the renewal [of the sponsorship].
"Last season alone saw bank and merchant promotions in over 60 countries and this announcement ensures we can continue to reward existing and potential customers in new and innovative ways."
MasterCard is gearing up for next week's Brit Awards, with a competition offering consumers the chance to duet with their favourite artists.