diff --git a/CHANGELOG b/CHANGELOG
index 7d605d16..dc6b8585 100644
--- a/CHANGELOG
+++ b/CHANGELOG
@@ -1,7 +1,9 @@
 Development Version
 -------------------
 
-Nothing yet.
+Bug Fixes
+
+* EXTENSION is now recognized as a keyword (issue785).
 
 
 Release 0.5.1 (Jul 15, 2024)
diff --git a/sqlparse/keywords.py b/sqlparse/keywords.py
index dfafedb7..6211e829 100644
--- a/sqlparse/keywords.py
+++ b/sqlparse/keywords.py
@@ -846,6 +846,7 @@
     'INHERIT': tokens.Keyword,
     'INDEXES': tokens.Keyword,
     'ON_ERROR_STOP': tokens.Keyword,
+    'EXTENSION': tokens.Keyword,
 
     'BYTEA': tokens.Keyword,
     'BIGSERIAL': tokens.Keyword,