The midfielder, who recently celebrated his 17th birthday, became Wolves’ youngest ever Premier League player in May when he made his debut at Burnley aged 16 years, eight months and eight days.
He first joined Wolves at the age of six and has risen through the ranks, going on to train with the first team on occasions this season under Cesar Peixoto, while he also featured during pre-season and was on the bench against Port Vale in the Carabao Cup last month.
The England under-17 international follows in the footsteps of brothers Jed and Jez in progressing through the Wolves academy.
Abbey has missed the start of the under-21s’ season due to injury but has now had minor surgery and is expected to return to action soon.
Academy director Jon Hunter-Barrett said: “We’re really delighted because Jerome’s been here a long time, coming right the way through the academy, and it’s a good news story for everyone involved.
“Jerome is a calm and consistent person and comes from a really good family, with his brothers being part of our academy previously, and that’s lived through Jerome and how he behaves on a daily basis.
“He’s benefitted a tremendous amount from being around the first team because you have to behave in the same way as them. When we get the opportunity for our talented young players to get that experience, they’ve got to go in and do well, which is what he’s done, but then they have to also bring back the learnings that they’ve taken from that experience.
“The club’s been in existence since 1877 and so many things have come and gone, but his debut record is a monumental piece of history, and given how long he’s been here, and his family’s connections to the club, it’s great all around.
“Retention is a big piece in what we do – we have to deliver, and it is really difficult, not just for Wolves, but for everybody, up and down the country. So, the fact that he sees the opportunity here, enjoys the environment, enjoys being challenged and can see the progression, is credit to the academy staff that turn up every day.”