The role sees Hobbs take on the management of the sporting and performance departments at the club, including the support staff around the men’s first-team and development teams such as coaching, medical, analysis and recruitment.
He is also tasked with ensuring the continued success and progress of the Wolves Academy and women and girls' programmes.
Hobbs, who has been at Wolves since 2015, most recently as chief scout and head of player recruitment, will be responsible for ensuring the football department operates at an elite level, while working closely with chairman Jeff Shi, new head coach Julen Lopetegui and his backroom staff.
Shi said: “I am delighted to confirm Matt in the role of sporting director; he has all the characteristics to be very successful in the position, and has done an excellent job building and developing the recruitment teams at Wolves, both the academy and first-team.
“Matt has excellent management, team-building and communication skills, and has already found a very good synergy with Julen and his team.
“I know he will be a be able to bring departments closer together, set very high standards and give our new coaching team the best possible platform for success.
“The last few months have shown the need for us to take a look at what hasn’t been working, assess and make some smart changes.
“We have had a shake up and this is now a fresh start - the past has gone and we only look forward and upward.”
Hobbs said: “I am honoured to be made sporting director at this incredible football club.
“This is an exciting time for Wolves and, with our world class management team now in place, I am very positive about where we can take the club collectively.
“I have daily conversations with Julen and his team about how we can help the club grow and achieve long-term success, and I am looking forward to helping us make our ambitions a reality.”
