Chelsea coach Jose Mourinho will face the FC Porto team he led to the Champions League title last season in the new first round.
Paris Saint-Germain and CSKA Moscow were also drawn in Group H on Thursday.
PSG coach Vahid Halilhodzic expressed awe at the draw.
"We really have no luck. Porto is the defending champion, Chelsea is the richest club in the world and Moscow is the farthest away," Halilhodzic said. "It will be a great challenge but one which can have leave psychological scars."
Opening group matches take place on Sept. 14-15.
FC Barcelona striker Henrik Larsson will be another facing his former team. His Catalan squad is in Group F and will take on Larsson's old Glasgow Celtic teammates, as well as 2003 winner AC Milan and Ukraine side Shakhtar Donetsk. Larsson scored 242 goals for Celtic.
"It is great to be in the Champions League, but we couldn't have asked for a much tougher group," said Celtic manager Martin O'Neill. "That is just our luck really, but let's just enjoy it."
Milan has been crowned European Champion six times, second only to nine-time winner Real Madrid.
"This is one of the best Champions Leagues in history and I'm sure fans are going to really enjoy it," Barcelona president Joan Laporta said.
Real Madrid was drawn in Group B along with Bayer Leverkusen, the team it beat to win the 2002 Champions League, courtesy of a spectacular Zinedine Zidane goal. Joining them are Italian giant Roma and Dynamo Kiev.
"The three teams we have to play are very equal. Roma is an important team but so are Bayer Leverkusen and Dynamo Kiev," Real Madrid coach Jose Antonio Camacho told Radio Marca.
Group C features three former Champions League winners: Bayern Munich, Juventus and Ajax. Israeli side Maccabi Tel Aviv completes the quartet.
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