The 24-year-old has scored 26 tries in 91 appearances since joining Trinity from Hull in 2012.
He was a member of the Wakefield team which ended an 11-game losing run with a 16-12 victory at St Helens on Friday night.
Lyne said: “I am delighted,. It is great to be able to get it tied up. It was a pretty straightforward decision and the negotiations were short.
“My intentions have always to stay here, it is a club that makes me feel at home and I am happy here.”
Trinity chairman Michael Carter said: “It is fantastic that Reece has signed a new deal to stay with the club.
“I think people forget he’s still only 24 with his best football still in front of him because he has been around for so long. He is an outstanding young man.”
Trinity have also signed forward Dean Hadley on a month’s loan deal from Hull.
The 24-year-old has yet to feature for the Airlie Birds this season and has joined Wakefield as cover for Jonny Molloy, who has a persistent ankle injury.