The Hereford-born back first broke into the first team at Sixways during the 2009/10 season and impressed the coaching staff with his natural talent and desire to improve.
The Warriors Academy product made five appearances in cup competitions last term, after making his senior debut when he came off the replacements bench against Olympus Rugby Madrid XV in the Spanish capital.
Frost, who has also impressed in the A League, made a first senior start for Warriors against Scarlets in the LV= Cup and grabbed a senior try against Newcastle Falcons in the same competition at Sixways last November.
Andrew Stanley, Head of Skill Development and Academy Manager at Warriors, said ahead of the weekend game with Newport: "We're delighted for Ollie and it is reflection on the hard work he has shown to his training the last couple of years.
"He has been rewarded with a two-year senior contract with the club and we rate him very highly. We have good players with the likes of Ollie, Andy Williams and Jonny Arr. He will be battling hard for recognition and to get as much first team action as he can do."
Frost said: "I'm really pleased to have signed the new contract to remain at Warriors and continue my association with the club.
"I've come through the ranks here from the EPDG to the Academy set-up and now into the first team squad so I'm delighted to be able to continue my development at Sixways.
"I have enjoyed been involved with the first team this season and played a number of games. I really feel that, under the guidance of Richard Hill and all the coaching team, I can prosper, especially with the style of rugby we look to play.
"The environment at Sixways is one I enjoy and also where I know I can improve and better myself as I strive to get even more game time for the Warriors."