The 22-year-old, scorer of the clinching try against France when Wales clinched the Six Nations Grand Slam in March, had been weighing up a move away from the Blues, with several French clubs reportedly interested in securing his signature.
But he has given the region a timely boost by choosing to continue to ply his trade in the principality.
He said: "I am very pleased to be re-signing for another year with the Blues and I can now look forward to the summer tour with Wales and next season with the region.
"I had a few offers outside of Wales and having gone through all the options thoroughly with family and friends, I came to the conclusion that the best option was to stay at the Blues, showing my loyalty to the region, coaches and the fans."
Gilbert has released a new line of rugby cleats. The Gilbert Virtuo 8S is part of the exciting new product. Check it out.
The entire All Blacks apparel line has been updated for 2013/14. Check out the New Zealand All Blacks polo.
The Nike Tiempo is a solid rugby cleat and one of few styles still made from full-grain natural leather.
The Gilbert Blitz 8S rugby cleat is a great cleat at a great price of $69.99. Get a new pair of cleats today.
A cool looking all black rugby cleat with the high performance adidas is known for. Get in the Gear!
Wear the crest of the British and Irish Lions on your t-shirt. A great look for the summer.
The All Blacks Performance t-shirt is black with hints of blue from the training jersey. Very Cool.
The New Zealand All Blacks training jersey for 2013/14. Get in the Gear!
The USA Rugby Pro Alternate rugby jersey is perfect for any fan of the Eagles. Get yours to wear during the summer Test matches.
The NEW All Blacks 2013/14 jersey has arrived at World Rugby Shop. Dare to wear the colors of the All Blacks.