The switch has been agreed just a week after it was confirmed that the 29-year-old is unlikely to play for parent club Aston Villa again due to financial constraints.
The defender reportedly earns £40,000-a-week at the West Midlands club and has a contract which does not expire until the end of next season. He has not played for Villa's first team since May 2012 and has been made to train with the club's development squad since the start of this campaign.
A lack of competitive action has not interrupted his international career - Hutton was included in the Scotland squad to face Poland in a friendly next week - but Bolton are hopeful that the full-back will still be hungry to prove himself at club level.
The Sky Bet Championship club are six points above the relegation places and have won just once in their last 11 league matches. "Hutton is the right deal at the right time and is the right player," said Dougie Freedman, the Bolton manager. "Alan wants to come, wants to play, wants to prove himself - he wants to get in the national team and we will benefit from it."