Your wife's sister could petition for your wife but the wait time depends on which country your wife is from. It could potentially take a long time. Also, your sister-in-law could only petition for your wife, not for you. You can look at the visa bulletins online to estimate the wait time. There might be another and potentially faster way to be in legal status.
I suggest discussing the case with an immigration attorney who can give you answers to the specifics of the case. The above is general information and does not create an attorney-client relationship.
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