The 2017/18 Premiers have a host of players off contract and Wilkinson said it was important to keep the nucleus of the side together after notching back to back season titles.
The 33-year-old played every minute of every A-League game in the recent campaign and took the armband in the absence of Alex Brosque.
A key cog in the Sky Blues backline during their past two record breaking seasons, the 16-time capped Socceroo said he was excited for the future.
“I’m really pleased to be signing on for another two seasons at Sydney FC,” he said. “This club is like family to me, it’s my home, and there’s nowhere else I’d rather be playing.
“There’s a great journey ahead of us in the next couple of years, we’ve got the majority of our squad sticking together and I want to be a part of the title successes to come.”
The evergreen Wilkinson is one of six Sydney FC players to make the starting XI in the Professional Footballers Australia A-League Team of the Year.
Sydney FC General Manager of Football Operations Terry McFlynn said Wilkinson was an invaluable member of the squad.
“Alex is one of our leaders and has been part of the backbone of the team during the success of the last two seasons,” McFlynn said.
“His qualities in defence and leadership off the park are key attributes in the success of the football club and it’s a major boost to have him on board for another two seasons.”
Wilkinson will continue to train with the squad for the next two weeks while also performing a number of club duties and functions before breaking for holidays towards the end of May.
The squad will return on July 2nd for pre-season training.