Toney joined the Sky Bet League One side on an initial 28-day youth loan on November 9 and has made six appearances for the club.
The 19-year-old, who joined the Magpies from Northampton during the summer, scored his first goal for the Tykes as they beat Wigan on penalties in the Johnstone's Paint Trophy northern area semi-finals on Saturday.
He netted from close range in normal time as the game finished 2-2 before also converting his spot-kick as Barnsley prevailed 4-2 in the shoot-out.
Tykes boss Lee Johnson told his club's official website: "Ivan has performed very well since joining us on loan and we're delighted that Newcastle have entrusted us to continue his development.
"I felt that his performance in our last game against Wigan was superb and he really showed what he's capable of in terms of his pace, hold up play and creating chances.
"He also got a well-deserved goal which will give him a lot of confidence heading into our upcoming games and I'm looking forward to working with him over the next month. He will be a big asset for us".
Toney said: "I've settled in very well over the past month and I'm really enjoying my time here, so I'm really pleased to extend my stay.
"The lads and the staff are a great bunch and made me feel welcome, so it was an easy decision to make when the opportunity came along to stay at Barnsley. It was an incredible feeling to get my first goal on Saturday, and I feel that there is a lot more to come from me."