Lawrence was a huge hit in his first season in purple, scoring five goals and providing two assists across his first 13 games before suffering a season-ending foot injury.
The 32-year-old's biggest highlight was a hat-trick in a shock 3-1 away win against Melbourne City in round 10.
Lawrence's signature comes hot on the heels of Glory re-signing captain Adam Taggart, Jaiden Kucharski, Stefan Colakovski, Sebastian Despotovski and Giovanni De Abreu.
Coach Adam Griffiths has also signed on for a further two years.
Glory haven't played finals since finishing sixth in 2019/20 under then-coach Tony Popovic, but Lawrence feels they have the pieces of the puzzle to challenge next season.
"I believe in the project of the club and how forward this club is going, and I want to be a part of that," Lawrence said.
"I hope I can bring success to this club.
"We've taken steps this season, but ultimately we want to be challenging for the top of the league, and if not top of the league, then top six at least."
Glory's best form last season came when Lawrence was up and running.
Perth ultimately finished 10th with eight wins, seven draws and 11 losses, but it was a big step forward from their back-to-back wooden-spoon campaigns.
"Tom has already shown that he is a match-winner and one of the very best players in the A-League," Glory football director Stan Lazaridis said.
Lawrence began his career at Manchester United before going on to make more than 400 appearances across a number of prominent UK clubs, including Leicester City, Rangers, Ipswich Town, Cardiff City, Blackburn Rovers and Derby County, scoring 78 goals in the process.
At international level, Lawrence made his senior debut for Wales in 2015 and has so far accumulated 23 appearances and three goals.
11°C