Sterjovski took over as head coach following the departure of Dwight Yorke on January 21.
The former Socceroos star has since guided Macarthur to two wins, three draws and seven losses, with a goal difference of minus 14 across that period.
In comparison, Yorke led the side to five wins, two draws and six losses, with a goal difference of minus two.
The run of poor results since January resulted in Macarthur plunging to the bottom of the congested table and they must beat Wellington at home on Saturday to have any hope of avoiding the wooden spoon.
Sterjovski, who is now locked in until the end of the 2024/25 campaign, has been part of Macarthur's coaching set-up since their inaugural season in 2020.
Despite Macarthur missing out on finals this season, the club's board has been "significantly impressed with the restructure of the first-team's playing style and standards under the guidance of Sterjovski since his appointment in late January".
"In staying until 2025, Mile represents the reinforcement to the football philosophy that we built before our first season in the A-League," Macarthur chief executive Sam Krslovic said in a statement.
"While this season has had its challenges, we are pleased with the progress of the squad and the development of many of our most promising players.
"We look forward to a successful future under the guidance of Mile."
Sterjovski was proud to have been offered the position for an additional two years.
"We have put in place a lot of new structures and we are starting to see the benefits, even if results haven't always gone our way," Sterjovski said.
"I believe we are well placed to deliver success in the coming seasons."
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