Peaty leads a 10-strong squad for the event in Copenhagen, Denmark from December 13-17, British Swimming announced on Wednesday.
The 22-year-old Uttoxeter swimmer in July won world titles in the 50-metres pool over 50m and 100m breaststroke.
Peaty, who set two world records in a day en route to world 50m gold, hinted at his wish to lower the 25m-pool world records in July and now has an opportunity.
"The short-course world records, I want to keep my eye on those," the Olympic, world, European and Commonwealth 100m breaststroke champion said in July.
"I've never done a short course tapered or shaved. That's something interesting.
"I can definitely take (the times) down. It's just when and where."
The shorter pool is quicker, because there are additional turns for swimmers to propel themselves off the wall.
Peaty's long-course world records are 25.95 seconds for 50m and 57.13secs for 100m.
The short-course bests, both held by South Africa's Cameron van der Burgh in 2009, are 25.25 for 50m and 55.61 for 100m.
Ben Proud, who won the 50m butterfly world title in Hungary, and 4x200m freestyle relay world champion Duncan Scott are in the squad, alongside world junior champion Freya Anderson.
British swimmers' main targets in 2018 are April's Commonwealth Games in Australia and August's European Championships in Glasgow.
Tim Jones, team leader and head coach for the event, said: "We have selected a team with a great mix of experience and future potential.
"Whilst the meet is early season, I am sure it will provide some great racing ahead of our benchmark long course meets in 2018."
Ross Murdoch, like Peaty a breaststroke specialist, and medley swimmer Max Litchfield will also compete, while Charlotte Atkinson, Kathleen Dawson, Emily Large and Jocelyn Ulyett have also been selected.
