The 23-year-old has put pen to paper on a new deal which will keep him at Carrow Road until 2028 following a prolific start to the 2023-24 season.
Sargent scored three times in four games before picking up an injury which has kept him sidelined since the end of August.
The USA international has now committed his long-term future to the Canaries and set his sights on helping them back into the Premier League.
"I'm very happy at signing the new contract and excited to stay here for a bit longer. I've liked this club ever since coming here, they're doing really good things. I see myself as being a big part of the team moving forward," he told the club's official website.
"My family have settled really well here, we're really happy with our time so far here. It's a lovely place to live. I really want to get promoted with this club, it's the biggest thing.
"I had a very good start to the season. I just want to get back as soon as possible to keep that momentum going. I will continue to do everything I can to help the team, to work as hard as I can, and I promise many more goals."
Norwich sporting director Stuart Webber added: "We're all delighted that Josh has committed his long-term future to Norwich City.
"Josh continues to develop into a player that can play at the highest level, and we're excited that he will continue that journey with us. We've been keen to make sure our younger players are committed to longer contracts and believe in the vision of the club going forward."
Sargent joined Norwich from Werder Bremen in 2021 and has since scored 20 goals in 74 appearances for the club across all competitions.
The Canaries currently sit seventh in the Championship table, one point outside the playoff places having won five and lost four of their opening 11 games.