Canterbury lefthander Nicholls was included in the 14-man squad for the first three ODIs after impressing coach Mike Hesson and fellow selector Gavin Larsen with his performances over the last 12 months.
The 24-year-old, who was the second top run-scorer in last season's domestic one-day competition, topped the averages (75.66) and scored an unbeaten 144 in the unofficial 'test' between New Zealand and Sri Lanka 'A' sides in October.
Nicholls continued that strong form in the domestic Twenty20 competition and looks set to reap his rewards with an ODI debut at his home ground of Hagley Oval.
"Henry has earned his spot after consistent performances over the last 12 months and during the New Zealand A campaign, he was exceptional across all forms," Hesson told reporters.
"He is a player who has got class and he's a player we want exposed to the international scene sooner rather than later so we're excited to see how he goes."
Hesson said opening bowlers Boult and Southee, who formed a deadly tandem during the World Cup earlier this year as New Zealand made their first final, would be rested.
Boult will miss the first three games in Christchurch on Dec. 26 and 28 and in Nelson on Dec. 31. Southee will be available for the Nelson game, with Matt Henry selected for the first two games.
"Both Trent and Tim by the time we get to the next test would have played five tests in a row," Hesson said.
"It's a long season and we need some fresh legs steaming in at the first ODI."
Injured all-rounders Corey Anderson, Jimmy Neesham and Grant Elliott were not considered for selection.
Elliott, who broke his arm in a domestic match, could be back playing during the Christmas period, Hesson said.
Anderson and Neesham have been struggling with back injuries and their bowling has been limited, he added.
"Corey is starting to increase his loads (and) it is likely he could be considered for the T20 as a batsman," Hesson said.
"We are hopeful by the back end of the season he will play a role with the ball. In terms of James, he's a long way off from bowling at the moment but it's nice to see him back playing cricket again."
The final two games of the series are on Jan. 2 in Nelson and Jan. 5 in Mount Maunganui before Sri Lanka end their tour with two Twenty20 internationals.
"At home we've been hard to beat so I think winning the one-day series is an expectation we should have of ourselves," Hesson added.
"We know Sri Lanka have got some talented batsmen and some pretty wily campaigners with the ball but we certainly rate our own skills in New Zealand conditions."
Squad: Brendon McCullum (captain), Doug Bracewell, Martin Guptill, Matt Henry (first two matches), Mitchell McClenaghan, Adam Milne, Henry Nicholls, Luke Ronchi, Mitchell Santner, Ish Sodhi, Ross Taylor, Kane Williamson, George Worker, Tim Southee (third match only).
(Reporting by Greg Stutchbury, Editing by Ian Ransom)
