Nadal had earlier stated his intention to play in the six-player special event at year's end but until Tuesday it was unknown if his knee issue would allow it. Nadal suffered a partial tear of the patella tendon in his left knee.
He missed the chance to defend his title at the Olympics and also was out of the U.S. Open and ATP World Tour Finals. The injury came after Nadal had won his seventh French Open championship.
The Abu Dhabi event is to start Dec. 27. World No. 1 Novak Djokovic and third-ranked Andy Murray are also entered into the field. Nadal is fourth in the world rankings.