He will cost Belgian outfit Liege £2.5m, the same fee Wolves paid when he moved to Molineux on a three-year contract in June.
Van Damme has made only six appearances for Wolves, scoring against Fulham.
"The agreement has been struck in the exactly the same way we brought Jelle to the club from Anderlecht when we signed him in June," Wolves chief executive Jez Moxey said.
Bit of a shame as he could have been quality but there we go. Left back to sign in January window then!
jsjoker100
"We receive the entire fee in the same way we paid it."
Van Damme, whose wife gave birth to a baby girl last week, passed a medical with Liege on Monday, having chosen to join them ahead of interest from Club Brugge.
Source: BBC Sport
Source: BBC Sport