The Rolls-Royce Merlin Engine was donated by the Boulton Paul Association to the Tettenhall Transport Heritage Centre in the city.
The engine, which powered the wartime Spitfire, Hurricane and Lancaster, was restored by the Rolls-Royce Heritage Trust in Derby.
Alec Brew, curator of the heritage centre, said: "We are so grateful to get this engine, to enable us to complete our Balliol restoration.
"It is also a reminder of the little known fact that Boulton Paul were installing Merlin engines in Wolverhampton, for longer than any other company, 18 years from the Defiant prototype in 1937 to the final Balliol trainer in 1955, with 692 Fairey Barracuda naval dive bombers in-between."
The engine, now with the heritage centre, was fitted to a post-War Boulton Paul Balliol trainer, and will eventually be fitted to the example being restored by volunteers at the site.
It was moved with "wonderful efficiency" by Andy Waters of CBR Classic Car Transport of Cheslyn Hay.
The heritage centre has been closed for all but two days in the last year, because of Covid, but will re-open on Saturday, when visitors will be able to see the Merlin and all the many other exhibits which have appeared over the last year.