The Galway-born flanker made his Connacht debut in 2004 and has since racked up more than 200 games for his home province.
Head coach Pat Lam said the former Connacht captain remains a frontline player, even after 12 years at the club.
"His character means he is very influential on and off the field and it's a real boost for Connacht knowing he'll be here for another two years," Lam told the club's official website.
"John is a true professional in everything he does and someone you want the other players to follow."
Three-cap 31-year-old Muldoon said he never entertained the idea of leaving his home club.
He said: "This is where I'm from and I have so much pride in every game I play for the province."
- Sports & Recreation