Dalton signed a six-year extension. According to multiple reports, the deal is worth up to $115 million and will prevent Dalton playing out the final year of his rookie contract.
The deal was announced at a news conference on Monday, but financial details were not released.
Dalton said he is relieved to have the deal finalized before the season.
"You do have it in the back of your mind, when is it going to get done," Dalton said. "Now we don't have to worry about it. Like (coach) Marvin (Lewis) said, just play the game and I don't have to have this hanging over me.
"To get this opportunity to come to the city of Cincinnati, get drafted here and play for the Bengals and now sign this extension and be here for a long time, I'm just so blessed."
Added Dalton: "We're excited to know we're going to be here for a long time."
Dalton has passed for more than 3,000 yards in each of his three seasons. He led the Bengals to an 11-5 record and AFC North title in 2013. He set career highs with 33 touchdown passes and 20 interceptions.
Dalton was a second-round draft choice in 2011.
"Andy is not only a fine player, I think he is an exceptional person," said Bengals president Mike Brown in a statement released by the team. "Nobody has more respect in our building than he. I would tell you that of all the quarterbacks we have had, he is respected by his teammates as much as any of them."
Despite his regular-season success, Dalton has been criticized for throwing six interceptions with only one touchdown in three postseason losses.
Lewis said Dalton is still improving.
""It's stating the obvious that this is a key move for the ongoing success of our team," Lewis said. "I congratulate our front office, and Andy and his representatives, for coming together to make this happen in a constructive way for the football team. Andy is still a young player, he has led us to the playoffs three straight years, and by far we have not seen the best of him yet."
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