The 22 year old midfielder, who was called into the latest Scottish Futures squad, has been in negotiations for the last couple of weeks and has had his wish of a two year deal realised.
Manager Jim Jefferies said "Gary has alwys been committed to extending the contract, but it was just down to the length of the term. Hopefully now details have been settled Gary can concentrate fully on playing issues and I am sure his focus will be 100% on Sunday's game."
It is some welcome good news for the club as a string of bad results, both on and off the park, have negated the season's early promise. The visit of Rangers provides the opportunity to turn the season around and everyone will be delighted that one of the brightest prospects in the country has agreed to stay at the club. MacDonald's signing, together with Peter Leven's extended deal, gives Killie one of the most exciting engine rooms they have ever had.
Jefferies may opt to change the attacking 4-4-2 formation which had worked so well early in the season into a progressive 4-5-1 with Gary Locke coming in to the midfield to offer some defensive cover which would allow the two youngsters to venture forward. It may mean disappointment for Steven Naismith who was one of the few to earn pass marks against Dundee United, although he could find a starting spot in a wide area.