Wolves have been seeking a permanent replacement for James Collins since July and Walker will now step up from his role leading the under-18s to permanently take charge of the under-21s.
He took the team during pre-season following Collins’ departure and now takes the role full-time after three years of working in the club’s academy.
The Stafford-born coach previously spent 14 years coaching in Stoke’s academy set-up, including eight years with their under-18s and under-21s.
Wolves academy director Jonathan Hunter-Barrett said: “Richard has been with us for the past three seasons and, in that time, has played a pivotal role in the progression of some of the young players who have been part of his age group.
“We feel he possesses the right skills and experience to take us forward in the under-21s environment, which is critical in really finishing the players off before those final stages of playing the game professionally.
“He knows all the players inside and out. He knows what they’re good at and what they need to work on, and he’s also been developing a good relationship with the new first-team coaches, which definitely helps with that transition.
“He’s a strong leader and he’s very consistent in the way he behaves and works. He’ll also instil the discipline that these players need as they move towards the professional game.”
Wolves are now undertaking a recruitment process for an under-18s head coach and in the meantime under-16s boss Karl Broadhurst is in interim charge.
Hunter-Barrett added: “First and foremost, we want to be as competitive as possible during games, but it’s always about individual development and individual progression.
“Christian Preusser and I will work closely with Rich to monitor how much the players are progressing and ultimately how ready they are to either play for us or go and play elsewhere.
“Richard’s job is really important in making sure each individual progresses. Sometimes that means we’ll do things in games which might look slightly different to what you would see in first-team football, because we have to make sure we’re developing the players in the areas they need.”