Financial terms of the deal were not announced by the Panthers, but NFL Network Insider Ian Rapoport reported that the contract is worth $4.3 million with a chance to elevate to $5.3 million with incentives.
Larsen, who is under contract through the 2020 season, was set to earn $630,000 in the final year of his deal.
The Panthers have been hit by injuries on the offensive line during training camp.
Starting left guard Amini Silatolu left practice Tuesday and needs surgery to repair torn meniscus, while All-Pro right tackle Daryl Williams dislocated his right patella and tore the medial collateral ligament in his right knee on July 28.
The 6-4, 325-pound Larsen, who can play center and guard, appeared in a career-high 14 games last season in place of Pro Bowl center Ryan Kalil. He helped the Panthers rank fourth in the NFL in rushing, averaging 131.4 yards per game.
The 27-year-old Larsen has played in 23 games with 15 starts over the last two seasons with Carolina.
Larsen was signed as an undrafted rookie out of Utah State in 2014. After stints with the Miami Dolphins and Washington Redskins, he was signed by Carolina in the spring of 2016 and was on the practice squad for the first half of that season.