On September 16, Richmond effectively called Martin's bluff following several months of talks.
They announced that Martin would consider offers from other clubs after negotiations broke down.
Melbourne and St Kilda ruled themselves out.
Martin flew to Sydney last week and had a tour of Greater Western Sydney's facilities before the Giants announced they would not try to recruit him.
His last potential option for leaving Punt Rd was denied on Sunday when Brisbane also announced they would not pursue a trade for Martin.
There is no doubting Martin's ability, but some clubs have baulked at the 22-year-old. He's considered an off-field risk, having been handed a two-match club ban in 2012 for sleeping in and missing training.
"We have always considered Dustin a required player at Richmond, and we are pleased he has re-committed to the club," Richmond's football manager Dan Richardson said on Monday.
"We have been encouraged by the way Dustin has developed as a footballer, and a person, in his time at Richmond.
"We now look forward to Dustin having another strong pre-season and continuing his improvement in 2014 and beyond."
Martin has played 86 games since his 2010 debut and polled 16 votes in this year's Brownlow Medal.
The Tigers released a statement confirming the new deal only a couple of hours before their annual club best-and-fairest function.
Martin was certain to feature prominently in the voting for the Jack Dyer Medal after playing every game this season.
He polled 16 votes in the Brownlow Medal, second at Richmond only behind captain Trent Cotchin.
"I want to thank Richmond and our supporters for being so patient during these negotiations," Martin said in the club statement.
"My family and I are grateful for the manner in which (manager) Ralph Carr has represented me.
"I am now looking forward to doing everything possible to help the club and my teammates have the success we all crave."
Martin was ranked second in the AFL for score involvement behind Collingwood star Dane Swan.
He was first at Richmond for kicks and uncontested possessions and second for total disposals.
Martin kicked 23 goals, his third-straight season of 20 or more.