Ross posted on his Twitter account that he had agreed to a multiyear contract. The 24-year-old Ross had until midnight on Monday to sign a deal, or he would have become a restricted free agent on July 1.
Ross, who plays shooting guard and small forward, is averaging 12.3 points, 2.7 rebounds and an assist per game this season. Those numbers are improvements over his career averages of 9.2 points, 2.6 rebounds and 0.9 assists per game.
''Terrence has shown growth with each season,'' Raptors president and general manager Masai Ujiri said. ''We are excited that he will be part of what we are building in Toronto. He is a great teammate and has worked hard to become one of our best shooters.''
Ross tied the franchise record with 51 points on Jan. 25, 2014, against the Los Angeles Clippers at Air Canada Centre. He also set career highs for field goals (16), 3-pointers (10), and minutes played (44) in that game.
The Portland, Oregon native was selected eighth overall by Toronto in the 2012 draft and averaged 6.4 points and 2.0 rebounds in 73 games as a rookie.
Last season, Ross averaging 9.8 points and 2.8 rebounds in 82 games as the Raptors won a franchise-best 49 games.