Torre spoke with Steinbrenner on the telephone Tuesday, shortly before he walked into the interview room at Yankee Stadium and made the announcement.
"He gave me his support," Torre said. "I'm just pleased I'm able to stay on and do this."
The two also spoke on Monday.
"I talked to George yesterday for probably 15, 20 minutes, and we discussed a lot of things: the team, what we do from here and things like that," Torre said.
With 1,973 regular-season wins, Torre is 10th on the career list and third among active managers behind Tony La Russa of the St. Louis Cardinals (2,297) and Bobby Cox (2,171) of the Atlanta Braves.
Torre has the longest uninterrupted term for a Yankees manager since Casey Stengel held the job for 12 years from 1949-60. Under Torre, the Yankees have gone 1,079-699. He trails only Joe McCarthy (1,460) and Stengel (1,149) for victories among Yankees managers.