Number 2 Roger Federer faces Paris Masters champion Robin Soderling in his group, along with home favourite Andy Murray and David Ferrer of Spain.
Nadal and Djokovic are joined by Tomas Berdych and American Andy Roddick in Group A.
The top two players from each round-robin group will contest the semifinals at London's O2 Arena.
The tournament begins on Sunday, with the final on November 28.
Nadal, winner of three Grand Slam titles this year, has never won the year-end tournament. He begins his campaign against Roddick on Monday.
Federer is bidding to win the ATP Finals for a record-tying fifth time, matching Pete Sampras and Ivan Lendl.
The 16-time Grand Slam champion plays Ferrer in Sunday's evening match, after Murray faces Soderling.
Djokovic, beaten by Nadal in the US Open final, meets Wimbledon finalist Berdych in Monday's earlier match.
Last year's winner, Nikolay Davydenko, failed to qualify for the tournament.