The 27-year-old United States international has struggled to break into the Wanderers' first team since returning from a 16-month injury lay-off earlier this year.
He made his comeback as a substitute during the 2-0 FA Cup win at Sunderland on January 15 but has made only two further appearances from the bench since then.
Holden will wear squad number 22 for the Owls and is eligible for Saturday's game against Barnsley at Hillsborough.
Bolton manager Dougie Freedman has confirmed that he will be offering Holden a contract extension despite sending him out on loan.
Freedman told the club's official website: "This is an opportunity for Stuart to go out and get games. Sheffield Wednesday are a big club and he'll be working with a good manager in Dave Jones.
"This is the next step in his rehabilitation process and he'll come back to us match fit. This is the best move for Stuart and is a win-win-win situation for everyone involved.
"We had a good chat earlier in the week. I informed him that we want him with us next season and have offered him a contract extension."