The 28-year-old has put pen to paper on an extended deal to keep him at Sixfields for another two years.
Taylor joins central midfield partner Joel Byrom in committing his future to the Cobblers.
After talks with Town boss Chris Wilder this week, Byrom signed on the dotted line on Thursday, and Taylor has quickly followed suit.
The former Cheltenham player has been a regular in the Northampton team since signing for the club in January from the Robins, initially on loan and then on a short-term contract following his release from Whaddon Road.
He has made more than 350 senior appearances during his career, winning promotion with Rochdale.