After Wolves stopped the forward from travelling to red list Mexico, due to him having to isolate for 10 days on his return, the national team asked Fifa to impose sanctions on Wolves.
This meant Jimenez would be banned for the trip to Watford tomorrow, while the club may have also faced fines.
However, Wolves, the Premier League and Fifa have now all worked with Mexico and convinced them to withdraw their complaint and allow Jimenez to play.
Head coach Bruno Lage said: “It’s a good decision for everyone, especially for Mexico, that we can use Raul.
“The game is about putting the best players on the pitch. It’s difficult times, but at the same time the best players from both sides should be on the pitch.
“For us we’re very happy to receive that news and thankful for the decision to help us in this situation.
“I want to see the best players from Watford and the best players from our side to play in the game.
“For the fans, for both clubs, it’s special to see the best players on the pitch.
“The club talked and we arrived at a good solution. It was the best decision for all and especially the fans.”
Further international breaks are coming up in October and November and it is still unclear whether players will be able to travel to red list countries – after the Premier League announced last month it would stop their players from doing so this month.
Fifa have also been working with the British government on an exemption for professional footballers.
Lage added: “The best thing for now is to see what happens in the next month.
“The federations in charge will arrange a good solution for everyone. We have one month to understand what is going to happen and they will take the best decisions for us.”