The veteran came out of retirement to sign a short-term deal with Wrexham in March, before saving a stoppage-time penalty against Notts County the following month to put Wrexham within touching distance of automatic promotion from the National League.
Wrexham, owned by Hollywood stars Ryan Reynolds and Rob McElhenney, eventually finished first in the fifth tier, four points ahead of Notts County.
"At the end of last season it was obvious that I enjoyed being at the club, I loved being part of the team and everything that Wrexham stands for," said Foster, who had a loan spell at Wrexham in 2005 shortly before signing for Manchester United.
"I'd decided before the end of last season I wanted to do it, because it feels like home. I've never joined a football club and felt at ease so quickly."
