Williams, who has won 95 caps, has to be content with a place on the bench behind his Blues colleague Sam Warburton.
Warburton has been handed Williams’ number seven shirt and packs down in the back row alongside Newport Gwent Dragons prospect Dan Lydiate and number eight Jonathan Thomas.
Coach Warren Gatland has, as expected, moved star centre James Hook to full-back instead of an injured Lee Byrne.
It was a role Hook filled with great success last autumn.Blues centre Tom Shanklin wins his 67th cap, partnering Andrew Bishop in midfield, with Dragons wing Will Harries slotting in for Leigh Halfpenny, who is sidelined with ankle ligament trouble.
With last season’s Wales captain Ryan Jones out because of a torn calf muscle, Scarlets hooker Matthew Rees skippers his country for the first time.
Wales are seeking only their second Tri Nations scalp from 10 attempts since Gatland took charge.
That solitary success came against Australia two years ago.
Gatland said: “There was debate in the back row, and we decided we wanted to have another look at Sam, who hasn’t played for us since South Africa in the summer.
“We had options on the wing as well, and we thought about Chris Czekaj at full-back, but in the end we have gone for experience there with James Hook.”
Wales team to face Australia