Batth joined Wolves at the age of 10, and after completing a successful loan spell at Sheffield Wednesday in 2012, he has established himself as the Black Country club's leading centre-back.
The 26-year-old has recently been linked with moves to the Premier League and neighbours Aston Villa, but he has showed his intent to remain at his hometown club by penning a deal until 2020.
Batth told the club's official website: "I am delighted to commit my future to the club and a club that I have been on a great journey with so far. I also hope during my continued association with the club that we will obviously progress and we will reach the Premier League.
"It has been a long journey for me at Wolves, and I have been here since coming to the Academy when I was ten years old.
"I have worked my way through the ages, playing reserve team football, youth team football, all the way up to obviously being the first team captain and representing the club in the Championship and that it is something that I am very proud of."
Batth has scored a total of 11 goals in 159 appearances for Wolves in all competitions.