Murray teamed up with Laura Robson at the mixed team championship in 2010 and 2011, with the pair reaching the final on their first appearance. The national teams face each other in a round-robin format, with each match comprising a men's singles, a women's singles and a mixed doubles.
On both the previous occasions Murray played at the Hopman Cup, he went on to reach the final of the Australian Open, before losing to Roger Federer in 2010 and Novak Djokovic the following year.
"I find it very good preparation for the Australian Open," Murray said. "The organisers look after everyone extremely well there. You get at least three single matches, you get the mixed doubles as well, which is good fun, it sharpens up the net game. Now that it's outdoors too, it's absolutely perfect, so I'm looking forward to it."
Murray, who opens his challenge at the Western & Southern Open in Cincinnati today with a second-round tie against Joao Soares of Portugal, warmed up for the Australian Open by winning the tournament in Brisbane in 2012 and 2013, while this year he played in Doha.
Watson, who has just climbed back into the top 50, will be making her debut at the Hopman Cup, which begins on January 4. "This will be the first time Andy and I will have played mixed doubles so I hope we can do our best to win the Hopman Cup," she said. "That would be brilliant."
The Australia team has also been announced, with Nick Kyrgios, who defeated Rafael Nadal at Wimbledon, joining Perth's Casey Dellacqua.
England's James Ward posted his first win at a Masters series event to reach the second round in Cincinnati. The British No.2 beat two top-100 players in qualifying and a third, Spain's world No.32 Guillermo Garcia-Lopez, 6-2, 3-6, 6-1 in round one. He will now play either the Frenchman Julien Benneteau or Blaz Rola, a lucky loser from Slovenia.
Ward has had a good run on the North American hard courts at second-tier Challenger level and carried that form into yesterday's match. Garcia-Lopez, in contrast, was on a four-match losing run and his lack of confidence showed in a lacklustre opening set.
Ward then missed eight break points in the first game of the second set and was made to pay as Garcia-Lopez levelled the match, but the Englishman responded superbly with in the deciding set, winning the first five games and clinching victory on his first match point. Ward is only 11 places adrift of his highest ranking of 137 and has already guaranteed himself $21,945 in prize money.
Meanwhile, Nadal will decide by the end of this week whether he is fit enough to defend his US Open title in 12 days' time after suffering a right wrist injury that ruled him out of two warm-up events.
The 28-year-old Mallorcan left-hander sustained the injury during practice last month and has been training with a cast on his right wrist.
He had to withdraw from last week's Rogers Cup in Toronto and this week's event in Cincinnati, putting in doubt his participation at the year's final grand slam at Flushing Meadows starting on Aug. 25.