The event, which Basel-born Federer has won five times, marks the penultimate week of the points race to the World Tour Finals in London, beginning in just over three weeks.
The 33-year-old Federer is among those already qualified, along with Novak Djokovic, Nadal, Australian Open winner Stan Wawrinka and US Open champion Marin Cilic.
Federer, who has played the last eight finals at the St Jakobshalle — he stands 37-3 at home — looks to close in on the year-end number one ranking held by Djokovic.
Nadal, meanwhile, will be desperately seeking some reassurance.
The nine-time French Open winner has not played in Federer's backyard for a decade and missed last year with fatigue after signing a three-year appearance fee contract in 2012 which he has yet to start honouring.
Even with an appendix which will require surgery in the coming weeks, the 28-year-old Spaniard looks determined to at least make an attempt at an appearance for Swiss fans as he searches for his first win in the city after losses in 2003 and 2004.
Nadal's camp says they will decide with doctors after Basel whether or not the world number three should play Paris or go for surgery on his painful appendix which he has been treating with antibiotics.
Basel will be crucial in shaking out the race for the remaining places in the field at the eight-man World Tour Finals showpiece.
Federer begins in the first round against Luxembourg veteran Gilles Muller while Nadal takes on a qualifier.
Fellow Swiss Wawrinka, seeded third, starts against Mikhail Kukushkin of Kazakhstan who was a semifinalist in Moscow on Saturday.
Milos Raonic takes the fourth seeding with the Canadian hoping to have recovered from illness which compromised his last two events, in Shanghai and Moscow.
He plays American Steve Johnson.
Fellow year-end contender Grigor Dimitrov is seeded fifth ahead of Ernests Gulbis, number seven David Goffin and eighth seed Ivo Karlovic.