Grafite will stay with the Bundesliga side until June 2012.
He told BILD: “We will sign the papers on Monday, I am going to stay until June 2012 and I am really happy to have this sorted out now.
“Wolfsburg has grown to a second home for me and I am delighted to stay.
“My wife was a factor, she said I should stay on. She likes the people at Wolfsburg so much and I like playing for this great team. Everything is just right here for us.”
He added: “I know it will be tough now, but my goal is to get better every year.
“All those defenders will now be looking more after me, still I am ready for this. It is a big challenge.”