The 2021 season will be Hilton's 10th with the Colts, the only team he has played for in the NFL.
He wrote in a tweet that "it's only right I finish what I started."
One thing i kno about this city. Is that they love me. And i love them. I listen to all the songs. I read all the tweets. I will cherish this forever 🥲🥲. It's only right i finish what i started. #TYISHOME pic.twitter.com/PEfV5YoHIa— TY Hilton (@TYHilton13) March 24, 2021
The 31-year-old has spent the majority of his nine NFL seasons as the No. 1 receiver for the Colts, but he got off to the worst start of his career in 2020 as he saw a reduced role in the offense.
After catching just 29 passes in the first 10 games of the season -- and going nearly two full seasons without a 100-yard game -- he reappeared down the stretch with 27 receptions in the final six games as the Colts earned a wild-card spot. He finished with 762 yards and 5 touchdowns.
Although he has reached the 1,000-yard receiving mark in a season five times over his career, Hilton has done it just once (2018) in the past four seasons as injuries started to catch up to the veteran.
After missing only two games during his first five seasons, Hilton -- the last remaining holdover from the Colts' 2012 draft that also featured quarterback Andrew Luck -- missed a total of nine games in the past three seasons.
The four-time Pro Bowl selection has 608 career receptions for 9,360 yards -- an average of 15.4 yards per catch -- and 50 touchdowns.
ESPN's Mike Wells contributed to this report.