The move represents the first loan spell of Baker's career having been included in the Blues' first-team squad this season, appearing as an unused substitute in three matches, as manager Jose Mourinho continues to monitor his progress.
Baker, 19, will hope to play an influential role in the remainder of Wednesday's season, with the club aiming to make a late surge into the play-off positions, and admits he is relishing his chance to impress away from Chelsea.
"This is my first loan and I feel I am ready for this," he said. "It is the next stage of my development.
"I've played for the 21s and I've been in around the first team every day, so I think I am ready for this loan.
"I got a call to say Sheffield Wednesday were interested in me and I wanted to come because this is a great club with great tradition. I'm sure everyone will make me feel very welcome.
"I'm a team player with good spirit who likes to get on the ball and likes to get a goal. I am two-footed as well, which is something I worked on every day with my dad after school.
"I have a winning mentality - that is what the manager likes at Chelsea.
"He has spoken to me a lot about what I can do better, how I can improve, and I want to implement those things here at Sheffield Wednesday."
Joining Baker out on loan, and bringing the number of Chelsea players currently away from the club on temporary deals to 27, is Kane, who will move to Forest after spending the first half of the campaign at Bristol City.
The 21 year old's move to the City Ground was financed by the Sky Bet Transfer Fund, which was awarded by the Football League after Forest fan Shaun Lander won the prize earlier this season.