Despite the setback, the London-born forward has made 32 appearances during the campaign and scored six goals.
"Together with the belief of my team-mates, the boss and everyone on the staff, everyone has got behind me here at Arsenal which is brilliant," added Walcott.
"It's fantastic to work with the best manager in the world and play at Emirates Stadium, which is an unbelievable place to play in. I just want to continue playing my football at this club and look forward to many successful seasons ahead."
Walcott became Southampton's youngest-ever first-team player when he came on as a substitute against Wolves at the age of 16 years and 143 days.
Walcott delighted with his hat-trick
His prodigious talents attracted the attention of a host of Premier League clubs, including Tottenham, Chelsea and Liverpool, before Walcott eventually opted for Arsenal in a deal worth £12.5m.
Walcott made his Premier League debut against Aston Villa in August 2006 and made his first league start against Watford two months later before grabbing his first goal against Chelsea in the 2007 League Cup final.
The midfielder's international career has fluctuated between senior and under-21 level ever since he was a surprise inclusion in Sven-Goran Eriksson's 2006 World Cup squad.
The highlight of his England career to date was the three goals he scored against Croatia in last September's World Cup qualifier - becoming the youngest England player to score a hat-trick.
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.