The 40-year-old Spanish left-hander who won 22 Grand Slam singles titles will compete in "The MGM Slam" on February 28, 2027, at T-Mobile Arena.
Other players and a format for the event will be disclosed later.
Nadal, winner of a record 14 French Open singles titles, makes a hardcourt return in Vegas after playing in an exhibition event at his academy in Spain earlier this month.
Nadal played a 2024 match in Las Vegas against countryman Carlos Alcaraz.
"I remember how impressive it was to feel the energy of a full arena in a city like Las Vegas," Nadal said.
"Now I return in a different stage of my life, without the pressure of the tour but with the same passion for this sport. I have always loved competing, and even if my professional career is finished, that feeling never really goes away."
Earlier this year, eight ATP Tour stars played in a Vegas event where players competed in a 10-point tie-breaker format, with Brazilian teen Joao Fonseca winning the title.