The news is a boost for the Blues who have lost first five Bryn Gatland to the Highlanders from next Super Rugby season.
Tuungafasi joins utility back Damian McKenzie, halfback TJ Perenara, flanker Sam Cane and hooker Codie Taylor as All Blacks who will stick around at least two years beyond next year's World Cup in Japan.
Tuungafasi, who has played 14 times for the All Blacks and 63 times for the Blues, has also re-signed with his Auckland Mitre 10 Cup province.
The 26 year old, who made his Super Rugby debut in 2013 and All Blacks Test debut in 2016, said he had no hesitation in remaining with New Zealand Rugby and with his Blues club.
"My family and I are Aucklanders. We are proud to be part of the Blues and I'm so pleased to re-sign for the Blues for another three years," said Tuungafasi.
"There's no other club I want to be at. I want to achieve 100 games for the Blues and join that special group, and I want to be a big part of a Blues team that wins a Super Championship.
"I've been honoured to wear the All Black jersey and represent my country and that's something I cherish and want to have the opportunity to do in the coming years."
Tuungafasi made his All Blacks Test debut against Wales in June 2016 and has played 14 Tests in the last two seasons as well as the two matches against the Barbarians and the France XV on last year's Northern Tour. He scored a try in the win over South Africa in Auckland last year.
All Blacks Head Coach Steve Hansen said: "It's fantastic news for the All Blacks and the Blues that Ofa has re-signed. He has worked incredibly hard on his game over the last couple of years alongside Cronno (All Blacks Forwards Coach Mike Cron), has absorbed all the learnings and is always looking to improve. He brings a real physicality to his role, is a real team man - and is a big man with a big heart."
Blues coach Tana Umaga said Tuungafasi was a key player for the club and the organisation was delighted he had not only re-signed for the Blues but also for a significant three-year period.
"Ofa is clearly an influential player on the field, and one who is still developing as a world class front row forward," said Umaga. "He will clearly develop further as a significant leader within our club. And at the same time he is a major contributor off the playing field, a young family man who brings strong values to our group and to the number of charities that he supports."