Athletics Director Pete Boone said on Monday Kennedy's contract will now run through April 2014.
In four seasons, Kennedy has a record of 85-50 with two SEC West titles and a pair of NIT Final Four appearances. Kennedy came to Ole Miss from Cincinnati.
The Rebels went 24-11 this year.
Kennedy is the second coach at Ole Miss and ninth in SEC history to lead his team to three 20-win seasons in his first four seasons.
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