The 16-year-old, who has made tremendous progress for the Under 18s this year, will remain with the Reds until at least the summer of 2017.
Bree has signed an initial scholarship with his professional contract beginning on his 17th birthday.
Speaking to barnsleyfc.co.uk, James said, "It is a dream come true to sign my first contract, but I know this isn't the end, it is just the start for me. I've got to work very hard and push up the ranks and aim for the first team.
Speaking to barnsleyfc.co.uk, James said, "It is a dream come true to sign my first contract, but I know this isn't the end, it is just the start for me. I've got to work very hard and push up the ranks and aim for the first team.
"I've been here for four years now and I feel at home at Barnsley Football Club. I've got to know everyone well and I feel this is the place for me to be so I can continue my development.
"I've been playing at right back a bit for the Under 18s, but centre midfield is my favourite position. I like to get on the ball a lot and push forward up the pitch.
"The last four years have gone very quickly. Playing in the FA Youth Cup was great experience this season and I have two more years of that to look forward to.
"My parents have helped me a lot and have kept my feet on the floor. They don't let anything get to my head and make sure I get my educational work done.
"We've been playing some really good football and scoring good goals during our eight match winning run which I think a lot have seen on YouTube."
