It ends speculation that the 23-year-old may be returning to his old province, Leinster, where Ireland stand-off Johnny Sexton holds the No 10 jersey.
Carbery is the Heineken Champions Cup top-scorer so far this season with 68 points in the pool stages, and won his 18th cap for Ireland when he replaced Sexton in the win over Scotland at BT Murrayfield in the Guinness Six Nations.
Munster coach Johann van Graan is hopeful of having Carbery available for Saturday’s game in Edinburgh.
The player has been out since picking up a hamstring injury in the Ireland camp during the Six Nations and has not played since that 22-13 win for Joe Schmidt’s side in the Scottish capital.
“We’re very hopeful that he’ll play,” said van Graan. “He wants to be ready and all indications are that he’ll be fine.”
Meanwhile, former Ireland captain and Munster legend Paul O’Connell does not plan to join another club next season after his departure from Stade Francais was announced.
The French Top 14 club said that O’Connell will step down “by mutual agreement” at the end of this season.
O’Connell, who won 108 caps for Ireland and skippered the 2009 British and Irish Lions, agreed a one-year deal with Stade last summer.
In a statement, Stade said: “The Stade Francais Paris and its coach Paul O’Connell have decided by mutual agreement not to renew their collaboration next season.”
O’Connell added: “I have decided not to stay beyond my contract year with the club, and do not plan to join another club next season either.
“I had a great adventure at Stade. I am grateful to the club for the opportunity they gave me to live and work in Paris.”
O’Connell, 39, retired from playing in February 2016.