The group moved onto the site in Bee Lane earlier on Friday.
It is believed it is the same group of travellers who had been ordered to leave a field near Redhurst Drive by Friday morning, after a visit from police and council officers.
Wolverhampton Council said it was aware of the unauthorised encampment on Bee Lane and activity had begun to move the group on.
A council spokesman said: “The council is aware of an unauthorised encampment on Bee Lane.
"We have attended the site with partners this afternoon and begun activity to move the group on whilst protecting their welfare.
"The site will be regularly patrolled over the weekend and we expect the group to move on early next week at the latest.”