The 29-year-old midfielder was due to be out of contract at the U's this summer, but has now signed a new one-year-deal.
McLoughlin moved to the Abbey Stadium last summer after following a successful trial period with the club after turning down a new contract at Newport County .
He featured 26 times for Neil Harris' side, who secured automatic promotion in League Two, finishing third in the table to make an immediate return back to the third tier.
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On signing a new deal, McLoughlin said: “It was something that was left open at the end of last season as something we could revisit, and thankfully it’s gone that way.
“I loved last year – it is proper close between the staff and the players and I wanted to stay and be a part of it.”
The Irishman came through the youth ranks at Portman Road, making two senior appearances for the Blues, before departing Suffolk in 2019.
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