The Israel striker is a popular figure at the Amex Stadium after playing a key role in the team's promotion into the Premier League last season.
One of only a few attackers currently on the club's books, Hemed scored two goals in seven matches this season, before blotting his copybook with a red card that resulted in a three-match suspension.
Hemed said: "I was part of the team that got promoted and now I can be happy and enjoy the Premier League with Brighton.
"I wanted to show the club that I can play at this level.