Leshabela, 19, has earned rave reviews within the Academy of the English side since being promoted to the U-23 team last year.
His rapid development with the Foxes saw him called up to the first-team by manager Claude Puel in EFL Cup when they faced Southampton in November.
While Leshabela has yet to make his official first-team bow, the Premier League side have shown their faith in the teenager's potential by rewarding him with a new contract that will run until the end of the 2021/22 season.
"I've worked hard to get this and I'm just grateful to be given such an opportunity. This is the hard bit right now! I'm just looking to push forward and push into the first team," Leshabela told the club's website.
"It's gone really quick. It literally just flies by. It's been a good journey and I just want to stay in the game for many more years.
"[The Academy staff] have been so supportive and helpful and I'm grateful for all the coaches that I've had in the past over my time at the Club."
“In every game, you’ve just got to be at it because the manager is watching. You’ve got to just keep impressing.” ????— Leicester City (@LCFC) January 8, 2019
#lcfc youngster Khanya Leshabela outlines his hopes for the future after agreeing a new contract at King Power Stadium…