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I'm a German, living in Chile and extended my tourist visa several times in the past, the last time in January this year. This information is based on my personal experience.
In short: Yes, you can extend your tourist visa for 90 more days for a fee of 100 US$.
In detail: It is possible to extend your tourist visa once for another 90 days. To do so you have to go to an Extranjeria (Foreigners Office) before your visa expires but within the last 30 days of your visa (it is possible to go on the very last day but try to avoid it! [Edit from 21st of June 2017: do not start this on the last day! Some Extranjerias have changed the way they work and even getting an appointment may require you to go a day in advance. For your own good, start this process at least a week before!])
To find your nearest Extranjeria go to http://www.extranjeria.gob.cl/contactenos/ and scroll down to "En regiones". You'll have to take your passport and the Tarjeta de Turismo (Tourist card), that you got when you entered the country from the PDI. You may have to present a photocopy of both documents (I never had to). I advice you to get to the Extranjeria very early (before they open) as usually people queue up and they may only attend to a certain number of people each day (for example 80 in La Serena) [Edit from 21st of June 2017: This changed. Ideally investigate how you will be attended before you go there!].
After taking your data you will be issued a paper in order to pay 100 US$. You will pay this in local currency (at the moment about Ch$ 70,000) at any bank (not the Extranjeria itself!). They will retain your Tarjeta de Turismo. You can collect your extended visa usually about a week later, presenting proof of payment (the stamped paper). Ask how long it will take! Anyway, it is not strictly necessary to collect your visa extension within the expiration period of your tourist visa. I advice to go at least one day later than advertised by the Extranjeria staff as your visa extension may still be filed in inaccessible parts of their system. Yes, Chilean bureaucracy is not the most efficient ...
Don't be surprised if they just hand you back your Tarjeta de Turismo with a handwritten slip of paper stapled to it.
Some other points:
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Obtaining a visa extension:
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If you need to request an extension, you may do so at any Departamento de ExtranjerΓa y MigraciΓ³n.
You need to present:
- Photocopies of the valid passport (identification pages, number and, granting and expiration date, plus the page with the seal or stamp of the last entry to Chile). Do not forget to present the original passport.
- Photocopy of the valid Tourism Card.
- A fee of US$100 equivalent in local currency regardless of their nationality
An alternative to that is leaving Chile briefly and re-entering (known as a visa run). Based on the link in Nathan's answer, it seems to be a popular method but there's no mention of how kindly Chilean authorities will look to that.
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I performed the visa extension recently (March 2019) in Santiago and here are some Santiago-specific details to add to the accepted answer which is still largely correct.