The former Wales Under-20 winger came to prominence in the senior game last season after scoring a series of sensational tries for the Ospreys.
The 19-year-old scored 14 tries in 19 games last season and was a member of the Welsh senior squad for the autumn international campaign and the summer tour where they faced Tonga and Samoa.
“I’m really grateful to the Ospreys for the faith they’ve shown in me with this new contract,” said Giles, who hails from Gorseinon on the outskirts of Swansea.
“The last 12 months have been incredible for me. If you’d asked me this time last year, I could never have imagined it would have gone like it has.
“My ambition last summer was to simply make a mark in training and hopefully do enough to get some Anglo-Welsh game time maybe.
“It’s been brilliant, but I know I can’t start thinking I’ve made it. There is a lot of work still ahead of me to make sure my development last season isn’t wasted, but I know I’m in the best environment to make sure I reach my full potential.”
Giles is part of a strong Ospreys back three which includes Canadian international Jeff Hassler and full-back Dan Evans.
“This is great news to start the season off,” said Ospreys head coach Steve Tandy.
“Credit has to go to the development arm of the business for the work they’ve done with another young, local talent. Keelan also has to take credit for his application, hard work and the level of detail he goes into with his learning. He leaves nothing to chance in his personal progression.
“His potential is clear to see. He excites supporters and coaches with his genuine pace and eye for the line, but he’s also incredibly brave.
“He handled last season very well. It’s difficult when you come through into the senior scene and do so well, as that brings with it a massive expectation to deliver every match. That’s harsh on a teenager, but he stepped up and really showed what he could do.
“We are proud of the youngsters we bring through, but the rising cost of keeping hold of those players means we can be victims of our own success in many ways.
“If you look at Keelan, 15 months ago he was a young hopeful on a development contract, now he is a first-team regular and Wales squad member on his second professional contract.
“Even though it becomes a balancing act with budgets, we are committed to retaining the best young players from our development pathway and Keelan definitely fits that description.”
