The defender will now stay with the club until at least 2018.
The former England under-21 international has signed a one-year extension to his current deal at the club, after impressing in an unfamiliar position this season.
Dawson started off his footballing education at non-league Radcliffe Borough before earning a move to Rochdale in 2009 at the age of 19.
He has since gone on to prove himself a very talented young defender, with impressive loans back at Rochdale and with Bolton Wanderers, since joining West Brom in 2010.
Dawson has played the majority of his football this term at right-back under Tony Pulis - who does not ask his full-backs to be pushing forward into opposition territory often.
In the future he is surely seen as a potential central defensive option for West Brom, rather than a full-back, and he will certainly hope to play their in the long-term at The Hawthorns.
Here is how West Brom fans reacted to his new deal on Twitter...
Happy Dawson has signed a new deal he's been great even when out of position.Good in the air,works hard and is always our outlet ball #wba— Sam Ross (@Sam_wbafc) February 18, 2016
#wba I am sure Dawson is Committed but for me not the quality we need at right back or as back up, passing is poor and too slow.— Jamie Betts (@tamestjibe) February 18, 2016
Pleased to hear Dawson has extended his contract! Not the sort of player to pull up any trees but he certainly works hard #wba— Sam (@Baggiehodgson27) February 18, 2016
Good news re Dawson. Best right back we have had in a long time. Model pro, first player at the training ground and the last to leave. #wba— Richard Jefferson (@richbaggie) February 18, 2016
Great news about Dawson....a more committed and professional footballer you could not wish to meet...we are very lucky to have him #wba— Pat Frost (@KitmanPat) February 18, 2016