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Adam Armstrong scored the only goal as Wolves edged out struggling Watford at Molineux to cut the gap to the Championship promotion places.
Cesar Peixoto's side started with intensity and went close through Jordan James and Marshall Munetsi before Armstong's 35th-minute goal.
After missing their past two matches, it proved a welcome return for the fit-again striker, who made the breakthrough after reacting quickest to a rebound from another Munetsi effort.
In worsening conditions, the second period provided little quality, but Wolves held on to move to within two points of the automatic promotion places while Alessio Dionisi's Watford continue to hover above the drop zone.
Prior to kick-off, both sides took a minute to remember Kenny Jackett after his passing earlier in June.
The former Wales international played his entire senior career at Watford and began his managerial career there in 1996 before later leading Wolves to a record-breaking promotion to the Championship in 2013.
While the hosts came out positively, the Hornets gave their travelling supporters little to shout about and left the West Midlands having failed to manage a single on-target attempt on goal.
The optics of a single-goal defeat may seem creditable against a side who were in the Premier League last season, but in truth the margin of victory would have been greater but for Watford goalkeeper Federico Ravaglia making several impressive stops.
This result, coupled with defeats for both Swansea City and West Ham, leaves Peixoto's Wolves fourth in the table and now in touching distance of the top two.
For Watford boss Dionisi, the relief of last week's win over Charlton gave way to a feeling all too familiar this season.
They have now lost five of their last six and the Italian's time in charge could be heading for a familiar outcome under the ownership of Gino Pozzo.
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