The former Barcelona and Bayern Munich boss has agreed a new rolling one-year deal to extend his stay at the Etihad Stadium until at least the end of next season.
Guardiola's current contract was due to expire next summer and so there were questions over whether or not this would be his final campaign in charge.
However, these now appear to have been quashed as he has agreed terms on a new deal.
The option for an extra year means he would reach a decade at City should he remain as manager for that long.
It is understood that the agreement was made during the current international break and Guardiola told the club he'd stay in October.
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Last month, Guardiola claimed 'part of me is leaving' after is was revealed that sporting director Txiki Begiristain will depart the club.
Speculation over whether or not he'd call time on his stint at the Etihad Stadium only increased as a result but this will now end.
The Spaniard joined City in the summer of 2016 after glittering spells at Barcelona and Bayern, winning six league titles across the two clubs.
Guardiola guided the club to third in his debut Premier League season but then won back-to-back titles in 2018 and 2019.
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City fell off the pace in the 2019/20 campaign as rivals Liverpool were crowned champions but this only inspired a meteoric comeback.
They have won the Premier League title for the last four seasons in a row, the first club to ever do so in the English top flight.
Alongside such dominance in the league City won their first ever Champions League title with Guardiola 2023, his third European triumph as manager.
They have also lifted the FA Cup on two occasions and the Carabao Cup four times with the 53-year-old across his eight full seasons.
UEFA Super Cup and FIFA Club World Cup success has also followed, meaning City have won every major trophy possible.
Guardiola has won 360 of his total 490 matches in charge across all competitions, with his sides scoring a whopping 1,239 goals.
City are currently second in the Premier League table and five points behind leaders Liverpool, but the latest news could inspire them to an incredible seventh title under Guardiola.