The Spanish player - champion in 2008 and 2010 - opened his bid for a third Wimbledon title with a 6-1 6-3 6-2 victory over Australia's John Millman in the first round on Monday.
The 10-times French Open winner has not gone beyond the fourth round at the event since losing to Novak Djokovic in the 2011 final.
With Federer seeded three and Nadal four, the pair could meet in the final with seven-time champion Federer beginning his campaign for an eighth WImbledon against Alexandr Dolgopolov on Centre Court on Tuesday.
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Nadal leads 23-14 in the head-to-head with his rival, but Federer has won the last four meetings between the pair, including three this year at the Australian Open, Indian Wells and Miami Open.
"If I reach the final, I'd like to face a different opponent than Federer," said Nadal, who beat Federer in the 2008 final after defeats in 2006 and 2007.
"I don't like to face best players in the final and I think I played against Roger already enough times this year."
Having lost twice in the second and once in the first and fourth rounds in recent years, Nadal is content after securing a meeting with Donald Young in the last 64.
"It was a very positive match for me, a good start," said Nadal
"At the beginning I was trying to not have a lot of mistakes, playing more safe, but I finished the match hitting some great forehands.
"That's the way I need to play - aggressive with my forehand - if I'm to have a chance here."
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