The 19-year-old shot-stopper joined the Academy at the age of 11 before signing his first professional deal with the club in December 2021.
A representative of England at Under-18 level, keeping a clean sheet on his debut for the Young Lions in a 3-0 victory over Russia in October 2021, Thompson has recently returned to Newcastle after spending the first half of the 2023/24 season on loan at League One side Northampton Town, keeping five clean sheets in 15 appearances for the Cobblers.
Thompson told nufc.co.uk: "I'm really excited to continue my career with the club I've supported and grew up with. It's another opportunity to try and progress further as a footballer and, hopefully, make it as a player at Newcastle United.
"The development that has been put in place for me and a clear focus on where they want me to go were one of the main reasons in signing a new contract. It shows good faith that they see a progression in how I've been playing so I've been rewarded in that sense.
"I like to think my loan spell at Northampton went really well. I got a lot of games under my belt, which I was pleased to do. That was always the aim going out on loan and not only getting that experience of senior football but actually getting experience of playing senior football as well.
"It was a step up from what I was used to in academy football, with a different style but I feel like I adapted well and coped with the demands. From the results we picked up in the first half of the season, I think it went quite successfully.
"At the start of the season, everyone was unsure how the season was going to go after getting promoted from League Two and how difficult it may have been. By the time my loan ended, we were situated in the top half of the table which was, not so much of a surprise, but a pleasant feeling for everyone around the building at the time."
Thompson made his professional debut away at Swansea City during Northampton's Carabao Cup first round tie against the former Premier League outfit and has featured regularly in-between the sticks for the newly-promoted club before his recall to Tyneside this month.
The former Ponteland High School pupil admitted he has benefited greatly from his loan stint at Northampton both on and off the pitch during his maiden taste of senior football.
"It was a change of lifestyle, being many miles away from my family and friends," Thompson added. "It was new to me, being the first time I've moved away from home. It was good to gain that independence and being thrown in at the deep end, learning that side of managing myself on my off days as well as looking after myself to prepare as best as I could for training and matches.
"I took a lot from my time on loan. It's always a nice bonus to pick up a clean sheet but to get five was a good feeling. I'll take lots of notes from what I did well but also what I could have done better. It's always a learning experience and since I've been given the chance to go there, it's allowed me to work on my own game.
"I might not have noticed it as much daily but from when I first went there and making my debut to my last game, I can see a vast difference in maturity and confidence levels."
With goalkeeping duo Nick Pope and Martin Dúbravka both unable to feature in last year's Carabao Cup final, due to suspension and ineligibility respectively, Thompson was part of the Magpies' travelling squad for the club's first domestic cup final since 1999 against Manchester United.
Completing the warm-up alongside Loris Karius and Mark Gillespie in front of over 87,000 spectators at Wembley Stadium, Thompson reflected on the "different" experience and, following his contract extension, is hopeful of replicating similar memories going ahead with his hometown club.
"It was the first time in my lifetime any Newcastle squad had got to a major final. That in itself was an experience but to be able to sample that on the pitch was something else and shows the difference what can happen when you start to win and, ultimately, that is where the club are trying to get to which I can hopefully be a part of in the future.
"Walking out in front of 40-50,000 Newcastle fans that day to do the warm-up at Wembley and even seeing the supporters before the final was really special. It's definitely something I'd hope to get more of.
"The aim is to focus and develop my game further, both on the pitch and in the gym. I now have that extra security to do that."
