Rees, who turns 18 a week on Saturday, has penned a deal until the end of the 2014/15 campaign after impressing manager John Still in training and during his four FA Trophy appearances.
The central midfielder joined the Hatters in 2007 having previously been on the books of both Cambridge United and Rushden & Diamonds.
Having been a virtual ever-present in Paul Driver’s U18 squad this season, Rees was handed his first team debut as a substitute in the FA Trophy first round replay against Staines.
The 17-year-old was then given his full debut in the 2-0 win over an experienced Wrexham side and also put in another display full of promse in the third round replay against Cambridge United.
Boss Still told the club’s official website: “Ian has shown a tremendous appetite for football and his enthusiasm and ability has really shone through and impressed myself and the staff.
“Ian’s performances in the FA Trophy, where he came up against very seasoned professionals, showed a great level of maturity. He wasn’t fazed by the situation and took the opportunity with both hands.
“He uses the ball very well and we are all looking forward to witnessing Ian flourish as a professional.”
On signing the deal, Rees tweeted: “Pleased to sign my first pro at Luton!”
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