Wolves' captain Oliver Tipton converted from 12 yards deep into the second half to hand Leicester's youngsters a league defeat on home soil.
There were only two changes to the starting XI that drew with Crystal Palace last time out, with Deniche Hill and Zach Booth coming in for Tom Wilson-Brown and Kian Pennant, with the latter dropping to the bench.
Live on LCFC TV, the game took a while to get going as both sides looked to gain possession of the ball, but weren't keen on leaving their defence exposed in order to get it.
Pace from Hill and Tawanda Maswanhise were causing Wolves the most problems as City looked to exploit the wide areas, however it was the visitors who had the first sight of goal, just before 20 minutes.
Bursting into the Leicester box, Nathan Fraser's opportunity was soon diminished when Bayli Spencer-Adams provided a last ditch tackle, preventing any threat to goal, while winning a goal kick in process.
Fifteen minutes from half-time and the Foxes saw their first chance of the match. Good speed and awareness from Logan Briggs allowed him the space to pick out Maswanhise in the box, but the striker, who hadn't seen many openings until that point, couldn't plant his head on the ball properly, and it curled out of play.
Over the next 10 minutes, Wolves had a succession of corners which led to a goalmouth scramble, but aside from a slight moment of panic, City's defence stood firm as both sides went into the break level.
The second period of play was similar to the first, with neither side taking substantial control, with the biggest battles happening in midfield, but Hill at left-back was producing the best moments for those in blue.
Showing electric pace, the full-back was keen to overlap, and coach Ben Petty's switch to a back five in the second half allowed him even more freedom. Often beating his man, the Bermudian delivered numerous crosses into the box, and had the chance to test the Wolves 'keeper himself on 70 minutes.
As most players overloaded the right wing, Hill found himself with a chance from the edge of the box, but made the wrong choice and decided to retain possession instead of trying his luck from range.
With 10 minutes to go, the deadlock was broken when the visitors won themselves a penalty. Substitute Tyler Roberts was fouled in the box by Harvey Godsmark-Ford, allowing the opportunity for the hosts' skipper Tipton to fire into the bottom right corner, as Chituru Odunze was sent the wrong way.
Over the last five minutes, Leicester looked to push for an equaliser, but truthfully it was Wolves who looked more likely to score again, having been energised by their converted spot-kick. The referee's whistle blew an end to proceedings and a single goal would ensure the points would be heading back with the travelling side.
Major moment – Wolves' penalty
In a game of few chances, the defining moment came when Harvey Godsmark-Ford fouled Tyler Roberts in the box. Offering the chance of a clean strike at goal, Wolves captain Oliver Tipton wasn't going to miss, as he found the bottom corner.
Who impressed? – Bayli Spencer-Adams
Despite the loss, Bayli Spencer-Adams was a keen figure on the pitch. Helping to control the backline, the defender made a big block to deny Nathan Fraser when in on goal, and helped to start attacks with long balls from the back.
Where do we stand? – 12th
The defeat leaves the Foxes in bottom spot of the league standings with 11 points.
Coming up – Liverpool (A)
City's youngsters are on the road this Saturday when they face Liverpool at Liverpool Academy in Premier League 2 Division 1, with a 2pm GMT kick-off.
The details...
City: Odunze; Wormleighton, Appiah, Spencer-Adams, Hill; Brunt (c), Leshabela; Marcal-Madivadua, Briggs (K. Pennant 58'), Booth (Godsmark-Ford 46'), Maswanhise (Evans 70').
Subs not used: Doherty, Nyoni.