Burke has struggled with injury problems this season

The agreement ends speculation that the Scotland international could leave after negotiations broke down ahead of the transfer window.

However, the 23-year-old will remain at Ibrox under new manager Walter Smith, after postponing earlier talks about extending his contract.

Burke made his Rangers first team debut in March 2002 and established his career under former boss Alex McLeish.

Talks stalled before Christmas, but Rangers tabled tabled a take-it-or-leave-it offer - reported to be in the region of �13,000 per week - which the youngster has opted to take, despite being linked with a move to Aston Villa.

Rangers manager Walter Smith said: "Rangers have a young team and we want to try and see them mature and play their best football for Rangers.

Hopefully he will play on a regular basis and produce his best football Rangers manager Walter Smith

"Chris has come through the ranks and he has got himself into a position where he is in the first team.

"He has perhaps missed more games than he would have liked through injury, but that can happen with younger players.

"Hopefully that will settle down and he will play on a regular basis and produce his best football."

Meanwhile, PSV Eindhoven have played down reports linking their Australian midfielder Jason Culina with a move to Rangers.

His UK agent, Dean Sheehan, claimed that the 26-year-old Culina would be an ideal recruit for the Ibrox club.

Culina also stressed that any move was subject to PSV being willing to let him go, 18 months before his contract expires.

And PSV spokesman Pedro Salazar Hewitt believes no contact has been made between the two clubs.