The 48-year-old, who took charge in January and kept his new club in npower League Two by one point, has put pen to paper on a contract which keeps him at Home Park until 2016.
"I am very, very pleased and very happy to get it all sorted out," he told the club's official website. "Obviously, now the hard work starts. I keep saying it - I'm ready to get this club pushed up the league, and that's what I am going to try to do.
"It's not going to happen overnight. The club, for the last two, three, four years, have been struggling at the wrong end of the table, and it's important that I try to get the club back to where it was only four or five years ago.
"With three years, I can settle, and everyone will get used to how I'm working, and I am positive I will get them where we want to go."
Argyle owner and chairman James Brent added: "The length of the contract emphasises that both he and the club see the relationship as a long-term one, focusing on taking us back up through the divisions."
- Sports & Recreation