Defending champions AC Milan were drawn against Arsenal in the last-16, knockout phase of the Champions League yesterday.
AC's city rivals Inter, unbeaten and flying high in Serie A, will play Liverpool, whom AC Milan beat 2-1 in last season's final.
Arsenal, who missed out on a favorable seed ranking after finishing second in the qualifying group, will host the Italian club on Feb. 19 or Feb. 20 with the return leg in Milan on March 4 or March 5.
The London club will have their work cut out against Milan, who last week were also crowned World Club champions after their 4-2 victory over Boca Juniors in Japan.
Despite standing 22 points behind Italian league leaders Inter, AC Milan also boast the FIFA Player of the Year and European Footballer of the Year in Brazilian playmaker Kaka.
AC Milan and Arsenal have only met once before -- in 1994 in the European Superclub competition, the Italians coming away with a 2-0 aggregate win.
Arsenal managing director Keith Edelman insisted they would not fear the seven-time Champions League winners.
"It's a great match and I'm sure the fans will be trying to book tickets already," Edelman said. "Games don't come much bigger than this. I'm sure it will be highly charged and very competitive. I think we would have preferred an easier one."
Chelsea apart, the draw was also hard for the three other British teams in European club soccer's showpiece tournament.
Celtic will face last year's winners Barcelona, while Manchester United face six-time French champions Lyon.
Liverpool, winners in 2005 and losing finalists last season, paid for having finished as a group runner-up with a tricky tie against Inter Milan.
Anfield chief executive Rick Parry expressed confidence that Liverpool could go on another long run in competition this season.
"We stopped a few hearts in the way we qualified. We've done well in recent years and we want to do well again," he said. "It's a big one but it was going to be big whoever we drew. It's a very long time since we played them ... It's going to be tough."
Roma were drawn against Spanish giants and nine-time former champions Real Madrid in what promises to be another humdinger of a match-up.
Chelsea play Greek underdogs Olympiakos, while German club Schalke 04 will no doubt be happy after being drawn against Porto, the winners in 2004.
Completing the draw was the tie between Turkish champions Fenerbahce and Sevilla, who trumped Arsenal to top their group and will be confident of winning.
Full draw:
* Celtic v Barcelona
* Lyon v Manchester United
* Schalke 04 v FC Porto
* Liverpool v Inter Milan
* AS Roma v Real Madrid
* Arsenal v AC Milan
* Olympiakos v Chelsea
* Fenerbahce v Sevilla
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