The “ambitious redevelopment” will see the pub chain establish its national Heritage Centre at the site, as well as convert the upper floors into a hotel.
The chain has now submitted a revised planning application to the City of Wolverhampton council after official plans were approved last year. The revised plan includes the addition of a sixth floor, bringing the total rooms to 90.
A national museum for the chain, the Heritage Centre, will now occupy both the basement and ground floor in line with the revised plans.
Wetherspoon spokesperson Eddie Gershon said: “The Moon Under Water is an extremely popular pub in the city.
“The planned redevelopment highlights our commitment to offering our customers the best pub possible. The addition of a hotel and heritage centre will be great additions too.”
He added: “We are proud to be investing in such a wonderful city as Wolverhampton.”
City of Wolverhampton councillor, Harman Banger, said: “This exciting project will help transform one of our key city centre streets.
“It will breathe new life into this building and forms part of the £1.1bn investment in the city centre, further demonstrating the growing confidence in our city.”
He added: “It will deliver a significant number of jobs and for a national chain like Wetherspoon to choose City of Wolverhampton for its national Heritage Centre is an honour.”
The site is expected to open fully later in the year, but will still continue to trade throughout the redevelopment.