Foster said: "Tupou has really impressed in his time with the All Blacks, and we see his signing as critical in our long-term plans. Great news."
Vaa'i, 22, has had a rapid rise through the ranks since captaining the Wesley College 1st XV, winning New Zealand Under-20s selection, and playing first-class rugby for Taranaki at 18 years.
He debuted for the Chiefs and All Blacks, aged 20, in the same season and has since appeared 31 times for the Chiefs and 15 times for the All Blacks.
Chiefs coach Clayton McMillan was delighted to secure Vaai's future with his side.
"He has always been a player of immense talent, and his achievements to date, at such a young age, validate that. He is only going to get better with age and experience which is an exciting prospect.
"There's no doubt he's going to be a significant contributor to the Chiefs and New Zealand Rugby in the years ahead."
Vaa'i said he was grateful to have the chance to continue with the Chiefs.
"I believe we've got a good crew, so I'm excited to see what we can accomplish together. Also, FMG Stadium Waikato is one of the best rugby grounds around and filled with loyal supporters."
Vaa'i has continued his growth with the All Blacks in the Lipovitan-D Rugby Championship and will be part of the side for its northern tour for Tests against Japan, Wales, Scotland and England.