And the Sky Sports pundit believes they will not have to spend big in order to achieve their dream.
Wolves have secured promotion to the top flight with a young, exhilarating squad - with the likes of Sylvan Ebanks-Blake, Michael Kightly and Wayne
Hennessey courting plenty of interest along the way.
Gray, who arrived at Molineux from Aston Villa in 1979 for a then British transfer record, believes although Mick McCarthy will need to bolster his ranks this summer, there is no need to pay inflated transfer fees.
"Wolves have some good players and if Mick can add to that in the summer, I'm very hopeful they could compete," said Gray in the Express and Star.
"It would be good to see them establish themselves in this league for four or five years this time. I'm really confident this time that Wolves can do it."
He continued: "Everyone goes on about huge investment but it requires investment - not necessarily huge. Mick, being the cute guy he is in the transfer market, I reckon can get a few experienced players on Bosmans or in the last year of their contracts.
"That's all part of managing in the Premier League and if you can get a few of those then you don't need to spend £15m-£20m. If you have a top staff, which Mick has, then you can do that."