The 20-year-old Portuguese follows Conor Coady, Raul Jimenez and Max Kilman in committing his long-term future to Nuno Espirito Santo's side in recent weeks.
Neto's new five-year deal – understood to be on improved terms – replaces his previous contract which ran until the summer of 2024.
And the delighted forward said: "It’s been amazing being here.
"I love being here; the family that we are building, all the club, it’s been fantastic for me, so I’m very happy.
“This new deal shows I’m working very hard and I was expecting it because I worked for it.
"I always work to improve my game, so it comes with that. I work hard every day, so I’m very happy about it, but I will continue to work now.
“We say that nothing is given to you, so you have to work hard and what I have done in the last year and a half is work hard every day, continue to improve and learn from my team-mates.”
Since joining from Lazio in the summer of 2019, Neto has played 52 games for Wolves and scored six goals.
He has impressed thoroughly this season, too, starting all seven Premier League games.
"In my first interview, I said that I want to be the best, so I have to work every day because I have to compete with my team-mates in a healthy way. I have to compete to play, to improve, and day by day I try to learn something," said Neto.
“It’s been very good to be here and learn a lot with the coach, with my team-mates, with everyone, and I will keep improving.
“I think it’s the good thing about this team, because we all think the same way, we’re like a pack, like we say, so we work all to the same goals, all of us try to improve every day, because the way that we play is to improve.
"It’s the mentality of the team and the mentality of the players that are taking this club to a higher level.”
Wolves boss Nuno also signed a new three-year deal in September, while Adama Traore is in discussions over fresh terms.
Neto added: "We go day by day; improving, working and letting things happen naturally, but I know what I want to achieve. I want to be the best."