Jota is poised to join on a season-long loan from the Spanish giants, with the deal likely to be announced in the next 48 hours.
The 20-year-old jetted into England on Friday to undergo a medical and finalise his move to Molineux.
He will become Wolves' 10th signing of an extremely busy summer which has also seen nine first-team players leave permanently or on loan – with five and a half weeks still to go in the transfer window.
The figure to buy Jota is unclear at this stage but he cost Atletico £6million when joining them from Portuguese side Pacos Ferreira a year ago. His value will have risen considerably after a successful loan spell last season with Nuno Espirito Santo at Porto, where he scored nine goals in 38 appearances.
Wolves are known to still be chasing a new striker this summer with a loan from a Premier League club looking a likely option.
Summer signings so far
Goalkeepers: John Ruddy (free), Will Norris (from Cambridge)
Defenders: Ryan Bennett (free), Roderick Miranda (from Rio Ave, £2.5m), Phil Ofosu-Ayeh (free), Barry Douglas (from Konyaspor, £1m), Willy Boly (from Porto, loan), Ruben Vinagre (from Monaco, loan)
Midfielders: Ruben Neves (from Porto, £15m)
Summer departures so far
Defenders: Mike Williamson (released), Silvio (released), Ethan Ebanks-Landell (MK Dons, loan), Dominic Iorfa (Ipswich, loan)
Midfielders: James Henry (released) George Saville (Millwall, undisclosed), Jed Wallace (Millwall, undisclosed)
Forwards: Paul Gladon (Heracles, loan), Jon Dadi Bodvarsson (Reading, £3m)