The deal dwarfs an earlier contract signed by her sister Venus three years ago to endorse Reebok for five years for $38m (£21.86m).
Nike is understood to have awarded 22-year-old Williams the deal on the basis that she remains in the sport for the next decade.
The brand is thought to have been trying to entice her away from Puma, who she has remained loyal to since she was a junior, for some time.
When her contract with Puma was reported to be coming to an end around a year ago, Nike is thought to have reignited its attempt to sign her with the $60m offer.
Other tennis stars to have endorsed Nike over the years include Pete Sampras and Andre Agassi. The brand is also currently sponsoring another US player James Blake, who Williams will partner later this month at the Hopman Cup in Perth, Australia.
It is expected that Williams' first Nike-sponsored outfit will be unveiled at the tournament. The tennis star, who beat her sister in the final at Wimbledon for the fifth time in six years this year, is reported to be having a large say in what she will wear.
Since this year's Wimbledon final, both sisters' places in the world rankings have slipped. They have stepped back from the limelight since the shooting of their elder sister Yetunde earlier this year in Los Angeles, which is understood to have caused them to reflect on their careers.
Serena is currently the world number three behind two Belgians, Justine Henin-Hardenne and Kim Clijsters, while Venus is number 11. Both Williams sisters are former number ones.
Nike spends millions of pounds on sponsorship of sports stars. Serena's $60m deal ranks among its biggest, behind golf player Tiger Woods, who has a $105m deal, Manchester United's $525m deal over 13 years, and the Brazilian football team's 10-year deal worth $695m.
The first major sporting star the brand signed up was US basketball player Michael Jordan in 1985 in a deal worth $4.3m. Jordan went on to become the most successful basketball player of all time and helped make the brand popular with young urban youth.
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This article was first published on brandrepublic.com