Guerrero, Peru's all-time top-scorer, missed the playoffs against New Zealand due to a 14-month ban after he tested positive for a cocaine byproduct contained in a tea.
Guerrero said he ingested the drug unknowingly when he thought he had been given herbal tea for a flu.
In Peru and other Andean nations, coca leaves are often consumed legally with hot water as a kind of tea.
He was free to take part in the World Cup after the Swiss Federal Tribunal agreed to temporarily lift the ban pending an appeal. The captains of Peru's Group C rivals - Australia, Denmark and France - had written to FIFA in his support.
Questions have been raised about whether the 34-year-old would be fit enough to play a key role in a tournament in which Peru will need to be at their very best to make it through the group stage.
But Gareca sounded positive.
"Whatever happened in the past, Paolo is very, very fit, he is training at a very high level and he really is ready to play," Gareca told a news conference in Saransk.
Guerrero made his return in Peru's white and red-slashed colours in fine style, scoring twice in a 3-0 win over Saudi Arabia in a friendly on June 3.
"Paolo is playing very well and he is very, very happy, preparing, and in a very good situation," Gareca added, without disclosing if he would be in the starting lineup.
Peru, making their first appearance in the finals since 1982, are hoping to build on the momentum which saw them improve dramatically as the qualifiers progressed.
Saturday's match could be decisive as they are unlikely to beat France, who are among the tournament's favourites, but stand a fair chance of defeating Australia.
Successfully dealing with Danish playmaker Christian Eriksen will be crucial in the battle. He topped the scoring charts in qualifying for Denmark with 11 goals.
"Eriksen is a very important player, very well known, and he will be a key player. We have to be able to face players like him," Gareca said.
"But we also have players at that level. He won't be the only player we have to concentrate on. Playing against players like him will allow us to grow and learn."
(Reporting by Angus MacSwan; Editing by Christian Radnedge)
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