The 26-year-old No 8, who has scored 20 tries in 130 appearances, was set to be out of contract in the summer but has chosen not to activate a clause in his deal which would have allowed him to speak to other clubs.
Guest, an England Saxons and England Sevens representative, has been in fine form this term and is part of a strong back-row line-up at The Stoop which includes England's Nick Easter, Will Skinner and Chris Robshaw.
Guest said: "There is so much potential in this young squad and I am excited about the future. I enjoy the style of rugby that is played here, something which suits me as a player, and want to continue developing as a player here at Harlequins."
The news follows new deals for props Joe Marler and James Johnston, and director of rugby Conor O'Shea is delighted to see another player decide his future lies with Quins. "I have no doubt we will be sitting down early next year to extend Tom's tenure at the club for a number of years to come," he said.