The 23-year-old from Thornhill, Ont., qualified for the eight-man event after his strong performance last week at the Paris Masters. Raonic beat Federer in the quarter-finals for his first victory in seven career head-to-head meetings.
"It will be a brand new match," Raonic said of their round-robin opener at the O2 Arena.
Raonic is one of three new faces in the singles field, along with Japan's Kei Nishikori and Marin Cilic of Croatia.
"The difference between now and a regular tournament is that I have to find my best form from the get-go," Raonic said. This is a new challenge for me. I have to find a way to get my game going quickly for the first match."
Reigning champion Novak Djokovic of Serbia is battling the second-ranked Federer for the year-end No.1 ranking at the Nov. 9-16 tournament. Switzerland's Stan Wawrinka, Britain's Andy Murray and Tomas Berdych of the Czech Republic round out the field.
"If things don't go well for me in the first round-robin match, then I'll be disappointed," said Raonic, who felt the centre court was rather slow after his practice session Friday. "But I have a team around me who will tell me, 'You have 48 hours to put the loss aside, find your level and do what you need to win the next one.'"
Raonic, the world No. 8, set London as one of his top goals at the start of the season.
"Making it here signifies a relatively successful year," he said. "This week is about trying to end the season on as much of an exclamation point as possible when facing other top guys in every match.
"The great thing about qualifying here was that I was able to produce my best tennis in Paris with my back to the wall. I was able to fight through and I'm very happy with that. Physically I'm running on adrenalin."
Raonic was slowed by a virus last month but returned to form in Paris. He beat Berdych in the semifinals before falling in straight sets to Djokovic in the final.
"If I'm to continue beating top players, I have to get a better understanding of what I need to do in specific situations, have a clearer vision about things, what I have to execute," he said.
"I need to stay more consistent in those tough situations."
Toronto's Daniel Nestor is competing in the men's doubles competition with Nenad Zimonjic of Serbia. They will open against Croatia's Ivan Dodig and Marcelo Melo of Brazil on Sunday.