Two goals from Diogo Jota earned Liverpool a 2-0 win at Anfield, but it was January signing Diaz who arguably impressed most.
The 25-year-old was given his start after coming off the bench last weekend against Cardiff and caused all sorts of trouble for full-back James Justin.
Klopp was delighted with Diaz's efforts and was asked about 'looking like a Liverpool player' by reporters.
"That’s a surprise for me as well," the German coach admitted. "That’s exactly how he looked in the training session so we thought okay why shouldn’t we try it then?
"We just let him play and he watched us obviously and we showed him a lot of situations but it looks natural in a lot of moments I have to say.
"That’s really quick, it was an outstanding first half, really impressive and he was involved in so many good football moments, a really, really good performance."
Diaz looked to be joining Tottenham Hotspur in the transfer window before the Reds snuck in at the last minute.
It's believed Diaz will offer competition to Sadio Mane on the left wing.
Liverpool are now nine points behind Premier League leaders Manchester City and have a game in hand on their rivals.
Jota has carried the load while Mohamed Salah and Mane have been away for the Africa Cup of Nations.
The Portugal international has scored 12 goals in the league and he finished convincingly on Thursday evening.
Klopp made special mention of Jota's efforts for both goals and his sensational form this season.
"The second goal is a brilliant goal. A counter-press. I love it. Jota with a little genius moment to put it into the right spot," Klopp continued.
"The first goal is really when you are in a goal-scoring moment then you are there. He is in that. Really happy for him and for us.
"We had a sense it could happen. He is not a bargain or whatever and we did not get him for free! But we hoped. He is still a young lad.
"We create more chances than Wolves did in all respect. We really thought he would be an outstanding player. He was already but he has improved for sure."
Klopp also insisted that Liverpool will continue to fight for the title despite City's sensational form.
Pep Guardiola's men haven't lost a game since October and defeated Brentford 2-0 on Wednesday.
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