The right-back has signed a deal until the summer of 2022 after making a first-team breakthrough earlier in the season.
The 19-year-old made seven first-team appearances earlier in the season - including going up against Neymar in a Champions League clash with Paris St Germain - and is now back in training following an injury lay-off.
Ralston told the Celtic website: “It’s a great feeling to sign with the club I’ve been with since I’ve been young. This is where I want to be and I want to start playing more games. I’ve enjoyed getting a taste of it and I’m looking forward to the future.
“It’s great, with the length of the contract, to have that out the way and I can focus on the football side of things. It’s a great feeling and I’m delighted.”
Ralston made his Celtic debut in a defeat by St Johnstone in May 2016 which immediately preceded their record-breaking 69-game unbeaten domestic run.
The Scotland youth international featured twice last season before a run of games in August and September was cut short by a knee injury.
He said: “There are so many ups and downs that come with being a footballer. I’ve enjoyed the experiences I’ve had up to now. With the injury, it’s just one of these things that happen and it’s how you come back from it.
“But it’s been a good start for me in my career and signing the contract now, I’m just looking forward to getting on with my football over the next few years.”