Hughes captured Sidwell from under the noses of Premier League rivals today, after he snubbed Wolves and turned down a move to West Ham.
The 28-year-old midfielder joins the Premier League club for an undisclosed fee on an initial six-month deal, which could potentially see him stay until the summer of 2014.
Hughes also revealed 33-year-old Danny Murphy has been offered a new one-year contract and insisted there was no way Damien Duff, linked with a possible move to former club Blackburn, would be allowed to leave the club in the January transfer window. But it is the capture of Sidwell, 28, who has played only four matches for Villa this season, which appears to have set Hughes' bid for January reinforcements in motion.
The Welshman explained: "He is a player whose career I have followed for a while now, and there was a deal in place to bring him in prior to when I arrived. At that time I just didn't think it was the moment to make it happen because I was new to the club.
"But he has been in my thoughts ever since, and when the opportunity to sign him in the January transfer window presented itself we moved quickly knowing there was a possibility he might go somewhere else. His intention was that he always wanted to come to Fulham - this was his first choice and we are delighted to have him on board.
"He is a young man who wants to get his career back on track and start playing football again. He has a good reputation in the game and is well admired. On the pitch he can get from box to box, he works tirelessly, is good on the ball and can also get you a goal. He wants to be part of what we are doing here - and because of that he will do well for us.''
There is no chance of Sidwell playing in the FA Cup against League One side Peterborough on Saturday but Hughes expects to play a full-strength side, including Murphy and Duff, at Craven Cottage.
On Murphy, Hughes said: "We've started discussions with Danny and his people and it is my intention that Danny stays here. He has been fantastic since I came to the club, a real positive influence on and off the pitch. Technically he drives the team, he has good awareness, he understands the game and is a good captain.''
On Duff, Hughes was just as resolute.
He added: "He's not available. He's very much part of what we are doing. Allowing a player of the quality of Damien Duff to leave would be bad management. I'm not about to do that.''
Instead Hughes - with Bobby Zamora a long-term casualty, Andrew Johnson suffering from a hamstring tear and Moussa Dembele doubtful for tomorrow's game with an ankle injury - will step up his search for a striker. He admits to being an admirer of Tottenham's David Bentley, who he worked with at Blackburn, but believes the transfer fee would rule out Fulham. Ditto Robbie Keane.
But he said: "We are still looking. We're a bit light (on strikers) and we have to address that.''
First, Hughes insists he will not be one of those Premier League managers who take the FA Cup lightly.
He said: "A lot of the success I had as a player came in the FA Cup and, for me, it's the best club cup competition in the world. Of course, the Premier League is huge and it is extremely important, but the FA Cup is a special competition. It's unique. It's one that I take very seriously and that will be very much the case here. It's a great chance for teams to do well and have a bit of success, so why not have a go and see how far you can get?''