The versatile Northern Irishman has agreed a new deal which will keep him contracted with the club until the summer of 2028.
The 21-year-old can play comfortably in midfield and at right-back for the Blues.
Teammate Colby Bishop also signed a new long-term contract extension earlier this week.
Since arriving from Glentoran in the summer of 2023, Devlin has scored 2 goals and recently celebrated his 50th club appearance, having featured in last week's 2-1 victory over Queens Park Rangers at Fratton Park.
Already this season with 2 months remaining, he has played more than he did in League One last term.
Head coach John Mousinho said: "Terry has developed at an incredible rate since arriving from Northern Ireland ahead of last season.
"The fact that he's come over here to play regularly in a different country at such a young age - and in different positions - is very impressive.
"He's already exceeded our expectations and is someone who never gives less than 100% every time he steps on to the pitch.
"We're delighted to tie him down for the long-term, especially so soon after agreeing a new deal with Colby."
For reaction to this news and a preview of Saturday's Championship fixture involving Luton Town and Portsmouth, tune in to Express FM on Friday (February 28th) evening from 6pm for the next episode of The Football Hour.
"Terry Devlin, baby..."
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