Steve Cooper is the manager of the club.
After eight games, Copper's team are bottom of the league.
The decision was made that he would remain in charge despite the doubts over his role.
A statement from the City Ground club said they were "delighted" to announce Cooper's new deal.
Our focus needs to be solely on football.
"As a group, we are all focused and will do everything we can to help the team move up the league table and once again demonstrate our qualities that led us to the premier league."
After his first season in charge, Cooper took Forest back to the top flight for the first time in 19 years.
He spent over one hundred million dollars in the summer transfer window.
The defeat at the King Power Stadium was Forest's fifth in a row and their only win of the season.
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