Smith signed a seven-year, $63 million contract extension that includes $25 million in guaranteed money, NFL Network's Adam Schefter reports.
"We are excited about getting this long-term contract done with Will," said Saints general manager Mickey Loomis. "We view him as one of our core players and look forward to him having an impact on our defense for years to come."
Smith, who received about $20 million in bonuses when he signed as a first-round draft choice out of Ohio State in 2004, was expected to earn between $1.8 million and $3 million next season, depending on performance incentives. The new contract will pay him more in 2008 but details were not available Wednesday.
Smith had been dissatisfied with his contract -- which paled in comparison to the league's top defensive ends. Indianapolis' Dwight Freeney is paid close to $12 million a year.
Last year, the Saints signed defensive end Charles Grant to a seven-year contract extension worth as much as $63 million if he reaches all incentives.
Smith has arguably outperformed Grant in recent years. He had 26 sacks over the past three seasons, compared to 11 for Grant.
Smith skipped much of the Saints' offseason training program because of displeasure with his contract, but participated in a mandatory minicamp and remained in New Orleans afterward. He also worked out with the team during its final two weeks of organized team activities, which are voluntary.
"He'll be able to show up for training camp now with nothing on his mind but getting ready for the season and the Super Bowl," Segal said.
Information from the Associated Press was included in this report