Cracknell's current deal with City was due to expire ahead of the Emirates FA Cup third round tie at Bury early next month but the young shot-stopper has now signed on for the remainder of the 2015/2016 campaign.
The 21 year-old originally signed for Phil Parkinson's side back in August after impressing the Bantams boss on trial over pre-season.
The former Hull City scholar has been on the bench for the Bantams' first team a total of fifteen times so far this campaign including City's last twelve games.
Along with his involvement with the first team, Cracknell has also featured in four of City's six Final Third Development reserve fixtures this season.
Speaking about Cracknell, Parkinson said: "Joe is working hard and we are pleased with his progress.
"Joe, Ben (Williams) and Lee (Butler, Goalkeeping Coach) have been working hard together as a group on the training ground.
"We'd still like to give Joe the opportunity to play some first team football somewhere at some point but he's with us at the moment and he's ready if needed."