The Premier League side were keen to re-sign M’Vila, who spent last season on loan at the Stadium of Light, but the Frenchman rejected the move.
M’Vila was then accused by Sunderland manager David Moyes of lacking the “fight” for a relegation battle and he has now committed his future to Rubin Kazan to 2020.
Rubin’s general director Ilgiz Fakhriev revealed a number of European teams were interested in the 26-year-old midfielder.
“We are pleased that the complex negotiations over the extension of the agreement with Yann have finally successfully concluded,” Fakhriev said in a club statement.
“M’Vila is one of the leading players in his position and interest in the midfielder was shown by many European clubs, so we are pleased to announce that Yann stays with us for a minimum of three-and-a-half years.
“One of the key points was that M’Vila himself expressed interest in continuing his career in Kazan.”