His signature brings to an end speculation that Ferguson, who was appointed in November 1986, was either no longer enamoured of the club or with what they were prepared to offer. It will make him the highest-paid manager in Britain, with estimates homing in on pounds 5m over the three years; pounds 1.67m a year or pounds 32,000 a week.
It also comes with United about to begin three weeks of football that could earn them an unprecedented Treble. Tonight they meet Liverpool at Anfield, one of four League matches that will decide whether they win the Premiership, and on 22 May they meet Newcastle United in the FA Cup final.
There is also the piffling matter of the European Cup final against Bayern Munich in Barcelona four days later.
"I am delighted that the matter has been settled," Ferguson said, "and that I have a contract which will take me to 60 years of age. My hunger for success remains undiminished and I will be striving to ensure that the next three years are as successful as the last 13."
If they are, then the monopoly regulators may need to be called in because Ferguson's 16-year tenure of what was once considered to be the hardest job in domestic football has brought success at a rate that even Sir Matt Busby could not match.
The first three seasons were barren - and there was much speculation that he would be sacked - but once Ferguson won the 1990 FA Cup the trickle of trophies accelerated to a torrent and it now stands at two Doubles, four League championships, three FA Cups, one European Cup-Winners' Cup and one League Cup. It will be a considerable surprise if those numbers remain unaltered at the end of the month.
The United chairman, Martin Edwards, said: "To secure the services of Alex for a further three years is fantastic news for the club and all its supporters. At the end of the contract Alex will have been manager for almost 16 years, a remarkable achievement in the modern game."
Since Ferguson signed his present four-year deal after winning his second Double in 1996, he has seen his earnings lag behind those of rival managers such as Tottenham Hotspur's George Graham and Newcastle's Ruud Gullit.
It is also one of the idiosyncracies of football that the man who makes the decisions gets paid less than the people who carry them out and many of the players that Ferguson has either bought or brought through the youth system were earning more than the man responsible for their success.
Ferguson knows his worth as well as he knows his mind and recently he said that the best managers should not be paid less than the best players. He was determined this should be reflected in his new contract. It is also a sign that United were so anxious to satisfy their manager they brought talks forward several months rather than wait until the end of the season.
Last year there were reports that Ferguson might be tempted to leave Old Trafford to coach abroad and while he did not oppose BSkyB's proposed takeover of the club that was halted by the Government, he did not vocally support it either. Whether he would have been prepared to have his decision- making power curtailed by a media company was open to much doubt.
That he has signed now also suggests he has received assurances over transfer funds this summer. Last month Edwards said Ferguson would be limited because of the blocking of the BSkyB takeover and the club's pounds 44m commitment to improving Old Trafford and building a new training complex.
Ferguson has stressed, however, that with an expanded Champions' League next season the need for extra playing resources is paramount. A compromise would therefore appear to have been negotiated.
Leading British managers' estimated annual salary before bonuses
1 Alex Ferguson
(Manchester United) pounds 1.5m
2 George Graham
(Tottenham Hotspur) pounds 1.2m
3= Arsene Wenger (Arsenal), Kevin Keegan (Fulham) pounds 1m
5= Bryan Robson (Middlesbrough), Walter Smith (Everton) pounds 800,000
7= Ruud Gullit (Newcastle), David O'Leary (Leeds), Brian Kidd (Blackburn) pounds 750,000
List excludes Gianluca Vialli (Chelsea), who is still on a player's contract.Reuse content