The 26-year-old has signed a three-year deal, and links up with his team-mates again ahead of the new campaign.
Head coach Lee Johnson revealed on Saturday that he had been in extensive dialogue with the popular midfielder, who had attracted significant interest from several Championship clubs, over the plans for the club moving forward.
O’Nien said he was ‘incredibly excited’ by the vision presented as the new season nears.
“I’m delighted to sign a new contract with Sunderland,” he said.
"I’d like to thank Lee Johnson and Kristjaan Speakman, and the owner and the staff, for putting their trust in me and enabling me to continue to play for this great club.
"Hearing their plans for the club and how they want to develop me personally was incredibly exciting and I can’t wait to get going again.”
Johnson said that he was ‘delighted’ to have agreed a new deal with O’Nien.
“We are all delighted that Luke that has re-signed for the club,” he said.
"He is a great character around the place and he’s perfect for the type of culture that we want to create, as well as being a very versatile and quality player – and one we hope can help us strive for the next level.”
The news is a significant boost in Sunderland’s squad-building efforts for the new season, after Aiden McGeady signed a new one-year deal last week.
While the club remain in talks with Denver Hume over a new deal, Johnson has said that he is ‘95% certain’ that Charlie Wyke will leave the club to pursue a new opportunity.
The Black Cats are hopeful that they will make a breakthrough in the transfer market this week, with Johnson saying on Saturday: “We have actually got four or five current bids on the table for various positions so it’s not like we’re not moving.
"We’re not a million miles away on probably at least three signings so I’d expect definitely two to come through the door next week.”