Aston Villa's midfielder has agreed to join Mick McCarthy's survival battle in a £250,000 loan deal.
Sidwell will play for Wolves until the end of the season when he becomes a free agent after his switch to Upton Park stalled.
Change of plan: Steve Sidwell is now joining Wolves, not West Ham
McCarthy has agreed to meet the player's £35,000-a-week wages in what is a considerable show of support from owner Steve Morgan.
A statement on the Wolves website today read: 'Wolves CEO Jez Moxey has confirmed the club are in talks with midfielder Steve Sidwell about a possible move from Aston Villa.
'Wolves had previously agreed a fee with Villa before Sidwell appeared to be poised to join West Ham.'
Sidwell was at Molineux as Wolves beat Chelsea 1-0 to move out of the Barclays Premier League's bottom three, at the expense of his current club.
Boss Mick McCarthy revealed after the game he was keen bringing in the 28-year-old, saying he would sign him 'in a heartbeat' if he was available.
Sign him up: Sidwell was in the stands as Wolves beat Chelsea at Molineux on Wednesday
And striker Kevin Doyle hopes the deal goes through.
"Steve would be an excellent signing if it happens,' he told the club website.
'I played with him at Reading for a number of years when we had some great success and he's also played for top clubs like Chelsea and Villa.
'If he does sign I'm sure he'll be raring to go.
'I have spoken to him this morning and we'll just have to see what happens but it would be a big boost if it goes through.'
Wolves are also leading the chase to sign Millwall defender Danny Shittu. The 30-year-old is available on a free transfer as his contract expires at the end of January.
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