The 27-year-old has missed the last five games with the problem, which head coach Darren Moore described as ‘bad’ last month.
But it is hoped Phillips and fellow injured midfielder James Morrison will return to action in February.
“Matty Phillips is outside and running, doing all his bits and pieces,” said Moore.
“It’s great to see him back outside, that’s where their development and recovery comes out, when they’re doing football-based practises. James Morrison as well, is back outside.”
It’s unlikely either player will be available for tomorrow’s FA Cup fourth-round replay against Brighton at The Hawthorns, but Jake Livermore is expected to play after returning from suspension.
“It’s great to have somebody of Jake’s calibre to get back in,” said Moore. “He’s an affectionate man who wants the best for everybody else. He epitomises what we want, good players but humble and respectable players.
“We’re delighted to have him back, he’s a breath of fresh air about the place.
“He’s got a wonderful competitive edge.”
Albion have now sold out their 2,900-seat allocation for the trip to Stoke City this weekend as well as their 2,167-seat allocation for the derby at Villa Park later this month.