"It's a great honour for me to now be a permanent member of the team," Jimenez, 27, told the club's website. "I'm very happy for this permanent deal as I feel that being at Wolves suits me.
"I want to make history here at the club. With my team mates, I want to put the club back into the top places in the Premier League, I think we all want that and have that ambition."
The Mexico international has 15 goals and seven assists in all competitions since joining Wolves on a season-long loan in June, helping them reach seventh in the Premier League and an FA Cup semi-final against Watford on Sunday.
"The impact Raul has made during his short time at the club has been fantastic and we're delighted that he'll be part of the club's long-term future," Wolves sporting director Kevin Thelwell said.
"His goals in the Premier League and FA Cup have been vital to this season's success and we're looking forward to seeing him contribute even more during what will be an exciting end to the season in both competitions."
(Reporting by Hardik Vyas and Rohith Nair in Bengaluru; Editing by Peter Rutherford and Ed Osmond)
