The Cubs picked up the option on Piniella's contract for 2010 on Tuesday, a day before the NL Central champions open the playoffs against the Los Angeles Dodgers.
The 65-year-old Piniella guided the Cubs to a 97-64 record, the best mark in the National League.
Piniella signed a three-year, $10 million deal with a club option after the Cubs went 66-96 in 2006 under Dusty Baker .
YANKEES: Brian Cashman is staying on as general manager of New York, agreeing to a three-year contract that runs through 2011.
The Yankees missed the playoffs this season for the first time since 1993. Cashman took over as GM in 1997 and his current deal was set to expire at the end of October.
The move was expected, though there had been rumblings that Cashman might be interested in running another club. Yankees co-chairman Hank Steinbrenner told Cashman earlier this season that the team wanted him back.
COMEBACK PLAYERS OF THE YEAR: Brad Lidge has a shot to cap his perfect season with a World Series ring. Cliff Lee should be ready to clear room in the trophy case for a Cy Young Award.
First, the two pitchers received a different honor when they were selected Comeback Players of the Year.
Lee was 22-3 with an American League-leading 2.54 ERA for the Cleveland Indians and could be their second consecutive Cy Young winner.
Lidge was a perfect 41-for-41 in save opportunities as the NL East champion Philadelphia Phillies' closer. He'll try to remain perfect in the playoffs, starting today when the Phillies open the best-of-five division series at home against Milwaukee.
Lee, an 18-game winner in 2005, was even better this season for the Indians.
He was Cleveland's first 20-game winner since Gaylord Perry in 1974. Now, he is the favorite to follow ex-Indians teammate CC Sabathia for the AL Cy Young Award.