The Bavarians, undefeated this season in the league, will also be without Sacha Boey and Alphonso Davies on Sunday as they look to extend their eight-point lead at the top of the table.
Kompany said Germany international Musiala, who sustained a fibula fracture and a broken ankle in the Club World Cup in July last year, was on the verge of a comeback, but Sunday's match was still too soon.
"He will not be available yet for this game," Kompany told a press conference on Saturday. "We are close but we don't want to take the last step too quickly. This week was good for him. He did the full training sessions."
Bayern are in top spot on 41 points, eight ahead of second-placed Borussia Dortmund, who needed a stoppage-time goal to rescue a 3-3 draw at Eintracht Frankfurt on Friday. They will increase their lead with a win.
"I want to see our strengths, no matter the opponent," Kompany said. "I want to see us at home being Bayern Munich and even against tough opponents play our game."
Bayern have never lost in Munich against Wolfsburg in 28 league matches, having won 26 of them and drawn two.