The former Scotland international has agreed to extend his contract until the summer of 2014.
The deal also includes an option to increase it by a further 12 months.
Thompson, 34, has enjoyed the best goalscoring form of his career with the club he supported as a boy.
The ex-Dundee United and Rangers star returned to Scotland in 2011 after spells with Cardiff and Burnley, and has struck 30 goals in 72 games for St Mirren.
He said: "It was the easiest decision I have ever had to make. I look forward to being involved in the continued progress of the club."
Meanwhile, Dougie Imrie is confident he can play his way into Danny Lennon's side.
The midfielder spent Saturday watching from the bench as his team-mates got a credible draw at Pittodrie, but he is determined to get himself back into Danny Lennon's starting line-up.
He has featured just twice in the team since the start of the year and, with new arrivals, Conor Newton and Esmael Goncalves making a name for themselves, competition for places is fierce.
"I have another year on my contract, but I want to play," said Imrie. "There are good players here and I have to prove I'm ready to take my chance when it comes."
St Mirren host Hibs this weekend and Imrie believes the result will go a significant way to deciding whether Saints nail a top-six place.
"At the start of the season our ambition was to get into the top six.
"I think it is vital that we try and aim for all three points, but we are well aware of the threat that Hibs will pose."