Mendilibar was out of contract this summer after two-and-a-half years with the Pamplona outfit and it was speculated that following on from the club’s relegation battle this term, he would be leaving.
However, the club have announced that he is staying for 2013-14.
“He has a contract. Osasuna must be rigorous in enforcing contract, especially if they are based on goals or objectives that have been met,” Osasuna president Miguel Archanco said.
“The aim was to stay in the league and, with more or less pain, for playing better or worse, that has been achieved.
“Therefore, Jose Luis Mendilibar will stay with us for a fourth season. There is a renewal, it simply fulfils the contract that he has.”
Mendilibar, 52, was also present and offered comment.
“I want to thank Miguel and the board for the confidence they have shown in me and the opportunity to fulfil my contract for another year, after that we will see. I hope the club aim to strengthen.”
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