The 24-year-old joined Wolves from Cambridge United last summer, and made seven first-team appearances during the 2017-18 campaign.
Norris only featured in one Championship match last term, but kept five clean sheets in six cup appearances, and has now penned a new deal until the summer of 2021.
"It's nice to have the club show so much faith in me and it's really pleasing to sort my future out so early on. It was really nice to have that chat and get it sorted before the season starts," Norris told the club's official website.
"It reinforces the confidence the football club have in me, it's a huge compliment. It's been a fantastic year for the football club, I'd have loved to have played a bigger part than I did but the part I did play, I am extremely happy with. It was a positive year for everyone involved.
"We can't underestimate the level of the opposition that we will be coming up against next year. We faced a couple in cups last year but the Premier League is a completely different beast. I know for a fact that no one here is underestimating the size of the challenge ahead."
Wolves will open their 2018-19 Premier League campaign at home to Everton on August 11.