Williams joins Gareth Maule and Adam Warren in committing to the west Wales outfit for next season and beyond.
The news follows Welsh internationals Ken Owens and Aaron Shingler signing new contracts earlier this season and with Phil John and Emyr Phillips also staying on, it is good news for head coach Simon Easterby.
He said: “These are important signings for us and there is a very strong foundation being retained here at the Scarlets in terms of experience, quality and flair.
“Add the eight players that we have signed going forward so far this season to a squad list that includes international class players like Jon Davies, Rhys Priestland, Liam Williams, Gareth Owen and Rob McCusker and we have a lot to be positive about.
“To have secured key players like Ken Owens and Scott Williams with the value and profile they have both inside and outside Wales shows that wherever possible, we are committed to retaining our best talent.”
Carmarthenshire born centre Williams has played all his rugby in the Scarlets region, joining from Newcastle Emlyn and playing for Whitland RFC and Llanelli RFC. He has since appeared 52 times for the Scarlets, went to the 2011 World Cup with Wales and has been part of the national squad which has secured back-to-back Six Nations triumphs.
“I am delighted to be staying at the Scarlets – I wouldn’t want to play my rugby anywhere else and it was important to me to be part of this region having grown up with Scarlets rugby,” said the 22-year-old.
“The team has shown its determination and ability this season and to be in the race for the play-offs in the PRO12 means everything to the players and supporters at Parc y Scarlets.”
During the international windows, fellow centres Maule and Warren have been at the heart of the push for a play-off place. They too, have both been rewarded with new deals.
Maule, who has captained the region, moved from the Newport Gwent Dragons in May 2009 and has appeared 88 times for the Scarlets, scoring 10 tries.
Warren meanwhile, made his Scarlets debut against Aironi in 2011 and a brilliant first season in regional rugby saw him earn an international debut for Wales against the Barbarians in June of last year.
Maule said: “It is really important to me to be part of the Scarlets going forward.
“There’s a great spirit and determination in this region and we’re a close-knit squad of players at Parc y Scarlets who are determined to achieve success.”