The deployment was only completed in late November, months after the mission was initially approved in February.
The move was controversial in South Korea, drawing anti-war protests, and was delayed by several months because of security concerns.
"This is an opportunity to raise South Korea's international status," ruling Uri Party member Chung Eui-yong told fellow lawmakers immediately before the vote.
The vote came just 90 minutes before the current authorisation was to expire at midnight.
The motion had been introduced to parliament in early December. But disagreement on controversial anti-communism and media bills between the ruling Uri Party and the main opposition Grand National Party (GNP) had kept lawmakers from convening a full session until the last hours of the year.
The conservative GNP largely supported the extension.
President Roh Moo-hyun has consistently backed the deployment, which he first proposed in December 2003, despite public protests and opposition from some members of his left-of-centre Uri Party.