Carson was the subject of interest from Portsmouth, and Liverpool could have cashed in on the England international.
But Benitez was always reluctant to allow the youngster to leave and has now seen the keeper commit his long-term future to the club.
That will open the door for Jerzy Dudek to leave Anfield. Portsmouth have also shown interest in a £1.5m move for the Polish keeper.
Carson isn't the only Anfield youngster celebrating anew deal. Highly-rated teenager Paul Anderson has also been rewarded with fresh terms, having impressed since his move from Hull six months ago.
* REPORTS in Spain today suggested Real Madrid have made an official bid of £20m for Xabi Alonso.
But Benitez today reiterated there's no chance of Alonso leaving the club.
"This report isn't true and we've not had a bid," said Benitez. "I've spoken to the people in Madrid and told them there is no chance of us selling Xabi.
"Xabi has already said he's happy here so there's no possibility of him leaving."
Florent Sinama-Pongolle has stayed at Melwood after suffering a hamstring strain, with Stephen Warnock also recovering from a minor operation.
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