The Serbian world number two started his campaign on Sunday with a straightforward 6-2, 6-1 victory over Italy's Matteo Berrettini.
Federer, seeded three in London, plays fifth seed Dominic Thiem in the evening match.
But all eyes are on a mouth-watering repeat of the Wimbledon final in Group Bjorn Borg later in the week -- the top two players from the four-man group qualify for the semi-finals.
Djokovic, 33, saved two match points on Federer's serve to win his fifth Wimbledon crown despite overwhelming support for the Swiss from the crowd in July.
Speaking after his victory at the O2 Arena on Sunday, Djokovic said he understood why Federer had such a huge following and explained his strategy to feed off the energy of the crowd.
"I understand why there is so much support for Roger," said Djokovic of the 20-time Grand Slam champion. "He is who he is. And what he has achieved and the personality that he is, he deserves that.
"Sometimes, you know, the crowd is on your side, the majority of the crowd is on your side, and sometimes it's against you. It's something throughout my career I had to learn how to handle, how to accept, and how to deal with that."
The Serbian, who has won 16 majors and is chasing the end-of-year number one ranking, said he had twisted "Roger, Roger" chants into Novak chants in his mind at Wimbledon.
"When I said that I was kind of trying to transform the chanting into 'Novak, Novak' when I heard 'Roger', that's really what I try to do," he said.
"It really works mentally in these kinds of moments. It will not be anything particularly different in terms of my reaction if that happens."
Djokovic said he would focus on what worked for him in order to win.
"Obviously there is a lot of people and tennis fans that like to see us going head to head, and of course I understand that, and hopefully it's going to be a packed house and everyone will enjoy their tennis."