The Voice UK winner Molly Hocking, indie musician Michael Armstrong and West End star Marisha Wallace will entertain a live audience at the event in Waterloo Place, which will also be live-streamed, from 1pm.
After being cancelled last year due to coronavirus restrictions, the parade, which previously saw more than 600,000 people flood the city centre, will be ticketed and limited to 600 spectators.
Performers representing 22 countries and all 32 London boroughs will take to the stage just south of the River Thames, rather than parading along the usual West End route between Piccadilly and Whitehall.
They include samba reggae band Bloco Fogo, City of London Brass Band and Stormtrooper dancers Boogie Storm, along with dancing lions, dragons and drummers from the London Chinatown Chinese Association, and dinosaurs and monsters created by Creature Events designers.
Parade executive director Bob Bone said the event will be “very, very different” this year because of coronavirus.
He told Sky News: “We’re really a TV show this year with a live audience.
“The audience is all ticketed and it’s completely sold out, it has been for quite a while, so don’t anybody try and come into it – but do watch it on TV, it goes out at 1pm.
“We’ve got loads of the usual participants in the arena-based shows this year – marching bands, samba dancers, people from Carnival del Pueblo, with all the Latin American countries represented.
“We’ve taken the advantage that we have this year of having an arena-based static show by building a stage as well into our arena so that we can bring in some very talented singers and dancers and so on.”
He added: “We’re pretty sure it’s going to be a very, very exciting and, we hope, successful event.”
Mr Bone said each year London boroughs compete for charity prizes, and the event has raised “the best part of £2 million” for local charities in the capital over the years.
London’s New Year’s Day Parade launched in 1987 and attendance peaked in 2020 when around 650,000 spectators took to the streets.
This year, viewers can watch the parade on the London Live streaming service or via the parade’s website.