The 20-year-old lock, who can also play in the back row, made his debut against Leicester in February and has gone on to turn in a string of fine displays despite the London club's disappointing end to the campaign.
The former Worthing RFC player has also been capped by England Under-20s and is part of the Red Rose squad for the upcoming Junior World Championship in Italy.
Launchbury said: "I'm pleased that the club have shown faith in me by offering me a lengthy contract and I was delighted to sign it. From a personal point of view this season has been great for me and I didn't think I would get as many first-team opportunities as I have.
"I've got a lot to learn and with the quality of coaching we get at Wasps as well as the experienced players I have around me, this is the right place for me."
Wasps head coach Shaun Edwards added: "It is marvellous news for the club that Joe has signed a new deal. Players like Joe are the future of London Wasps and he is a dedicated professional who works incredibly hard on all aspects of his game.
"He is improving all the time and hopefully that can result in him having a very successful career at all levels."
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.