Reach's loan contract was due to expire after the MK Dons game but the winger will now remain at the Coral Windows Stadium until 23 March 2014 at the earliest.
This means Reach is scheduled to now stay inside Bantams boss Phil Parkinson's squad up to and included City's trip to Shrewsbury Town - the side Reach started the season on loan with.
Reach, who has arguably been City's brightest star in their previous two matches, has started all five of the Bantams' league fixtures since his arrival at the club last month.
Thanks to his all-action displays down City's left flank, Reach has quickly become a fans' favourite among the Bantams faithful.
The 21 year-old earned the sponsors' Man of the Match award last time out against Port Vale on Tuesday.