Following Reading's playoff defeat, Taylor refused a new contract, and was sold to Leicester City, aiding them in their promotion to the Premier League. He also played as Leicester were victorious in the 1997 Football League Cup Final. After an injury-blighted 1997–98 season, he moved on a free transfer to Wolverhampton Wanderers. However, injuries took their toll, so Taylor retired from professional football to play non-league football for Cambridge City and Hayes, before fully retiring in 2002.