Nutini, who will make his only appearance of the year in Scotland when he brings in 2017 in the capital, had been due to open for the Pet Shop Boys 10 years ago, only for the city's festivities to fall victim to heavy winds and torrential rain.
Nutini ended up having to settle for an intimate performance inside Edinburgh Castle, which was hosting BBC Scotland's Hogmanay coverage over "the bells."
However Nutini is now preparing to top the bill at the open-air concert in the shadow of the famous landmark before almost 10,000 fans.
The Paisley-born singer will be making his only festival appearance anywhere in the world in 2016 when he takes to the stage shortly before midnight in a show which will mark the 10th anniversary of his hugely-acclaimed debut album These Streets.
The 29-year-old is the latest high-profile Scottish act to headline Edinburgh's Hogmanay celebrations, following the likes of Calvin Harris, KT Tunstall, Primal Scream, Biffy Clyro, Texas and Simple Minds.
Organisers of the capital's celebrations, who unveiled a host of acts performing at the event today, said they had spent seven years trying to secure Nutini for the headline slot.
His only previous appearance at the event was in 2008-9 when he famously opened the "Concert in the Gardens" with a brief performance before rushing through to Glasgow to headline the festivities in George Square.
Nutini's only other show in the UK this year was in Wales, when he played a one-off charity gig for a teenager who had lost his mother suddenly. Ieuan Jones, 13, had originally asked the singer to perform at her funeral.
Recalling his aborted concert 10 years ago, Nutini said: "When they offered us the gig, I was made up, as we had shown up at the castle, lined up to play alongside the Pet Shop Boys and unfortunately it was a washout ... forcing the powers-that-be to cancel.
"We went back as a three piece in 2008 to play a small set before legging it to Glasgow for George Square but this now gives us a chance to make up for lost gigs.
"We had no plans for any shows this year after Wales but this was the only one that over the years I hoped that we would get another shot at.
"Edinburgh is electric at that time of year and I'm glad we get a chance to be a part of it. Let's dance, ladies and gentlemen."
Al Thomson, director of Unique Events, the producers of Edinburgh's Hogmanay, said: "The only time we managed to get Paolo to perform before was in 2008, when he did a 20-minute set previewing the Sunny Side Up album before it had even been released. We put him on a bus and he went straight through to Glasgow."
Meanwhile indie-rock favourites The Charlatans have been confirmed as one of the main headliners of the capital's street party - almost four decades after they were formed. The band went on to notch up 12 top 40 albums and 17 top 30 singles.
Frontman Tim Burgess, who will be returning to the city months after an appearance at the Edinburgh International Book Festival, said: "Nowhere in the world sees in the new year like Scotland. I've been to Edinburgh before for Hogmanay and it's always brilliant."
The Edinburgh Jazz and Blues Festival is joining forces with the Hogmanay organisers to programme the stage at the top of The Mound, where James Brown is Annie, Brass Gumbo and Blues n Trouble will all perform.
Leading Celtic and trad bands Talisk, who feature the current BBC Scotland Young Musician of the Year Mohsen Amini in their ranks, Manran, Salsa Celtica, Feis Rois and the Top Floor Taivers will also be appearing at the event.
Organisers revealed that the street party will be extended to the Royal Mile for the second year in a row, with an open-air ceilidh starting at 8pm, an hour earlier than the rest of the street party, to accommodate demand from revellers and encourage visitors to learn traditional dances.
The city's three-day festival will get underway on 30 December with the annual torchlight procession through the heart of the Old Town to Calton Hill. Events on New Year's Day include the traditional "Loony Dook" into the Firth of Forth from South Queensferry.
Tickets for all Edinburgh's Hogmanay events go on sale on 30 September. Pre-sale tickets for Paolo Nutini's show will open this Thursday.