Petrov, the first Russian to participate in the sport, enjoyed a reasonable debut season in 2010, finishing 13th in the drivers' championship with 27 points.
"We are delighted to have Vitaly with us for two more years," Lotus Renault said in a statement. "Last year he evidently showed on several occasions that he has the potential to achieve great things.
"It's just a case of putting it all together each weekend, at each race, and that will be his main concern for 2011. Thanks to Vitaly and the team, Russia is opening up to Formula One."
The 26-year-old Petrov added: "I am eager to prolong working with this team and I am sure I can live up to the expectations they have of me."
Russia is taking an rising interest in the sport, and F1 supremo Bernie Ecclestone announced in October that a deal had been reached for the East European country to host a grand prix in Sochi from 2014 to 2020.
The news of Petrov's new deal came two weeks after Group Lotus plc announced it had acquired a main equity stake in the racing outfit once run by Flavio Briatore, with car manufacturer Renault deciding to sell its holdings in the financially-troubled French team.
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