The deal was announced Friday by general manager David Poile.
It prevents him and the team from going into arbitration and kept Kostitsyn from becoming an unrestricted free agent.
The 24-year-old player from Belarus led the Predators with 23 goals and tied the team for lead in points with 50 last season, his first with Nashville. The 23 goals were one shy of his total from his first three seasons in the NHL. His points total equalled his effort in the previous two seasons.