The loosehead prop, who has played 14 tests for the All Blacks, said re-signing was an easy decision.
"I am loving my rugby at the moment," the 27-year-old said.
"The All Blacks and Crusaders both have fantastic forward packs and I have learnt a lot and progressed my rugby significantly in both environments.
"I want to continue to improve my game and, from a Super Rugby point of view, the Crusaders is the best team for me to do this. So re-signing for a team I love was an easy decision."
Moody joins the likes of Aaron Smith, Julian Savea and Brodie Retallick, all who are signed on through to 2019.
All Blacks head coach Steve Hansen praised Moody's decision to re-sign.
"Joe's re-signing is great news for the All Blacks and New Zealand Rugby," Hansen said.
"He has developed into a very important member of the All Blacks, he is a very good scrummager and works incredibly hard on his core roles. We look forward to watching how his game develops even further."
Crusaders coach Todd Blackadder, in his last season with the franchise, said similar things, believing there was still room for Moody to keep improving.
"Joe is an accomplished and strong loosehead prop," Blackadder said.
"He is a formidable scrummager and a talented player that is only getting better.
"His hard work and natural talent has enabled him to progress his rugby to the highest level and he has an exciting future ahead of him.
"He is a great asset to the Crusaders and we are delighted that he has re-signed for another two years."
Moody has made 48 appearances for the Crusaders since debuting in 2013.
