A flexible polymer chain in the presence of inert macromolecular crowders will experience a loss of configurational entropy due to the crowder excluded volume. This entropy reduction will be most pronounced in good solvent conditions where the chain assumes an expanded coil conformation. For polymers that undergo a folding transition from a coil to a compact ordered state, as is the case for many globular proteins, macromolecular crowding is expected to stabilize the folded state and thereby shift the transition location. Here, we study such entropic stabilization effects for a tangent square-well sphere chain (monomer diameter σ) in the presence of hard-sphere (HS) crowders (diameter D ≥ σ). We use the Wang-Landau simulation algorithm to construct the density of states for this chain in a crowded environment and are thus able to directly compute the reduction in configurational entropy due to crowding. We study both a chain that undergoes all-or-none folding directly from the coil state and a chain that folds via a collapsed-globule intermediate state. In each case, we find an increase in entropic stabilization for the compact states with an increase in crowder density and, for fixed crowder density, with a decrease in crowder size (concentrated, small crowders have the largest effect). The crowder significantly reduces the average size for the unfolded states while having a minimal effect on the size of the folded states. In the athermal limit, our results directly provide the confinement free energy due to crowding for a HS chain in a HS solvent.