Chelsea have stormed to the top of the league after seven straight wins, during which they have conceded only one goal, but City are just a point behind them in third place.
"Conte is without doubt one of the best -- maybe the best, maybe one of the best -- coaches in the world right now," Guardiola told a press conference at the City training centre in Manchester.
"His statistics, his numbers, the way they play are really good. It's the first time we are going to face each other and it's good to play against them."
He added: "He made an exceptional job in Turin with Juventus and the (Italian) national team as well.
"He's a coach, when you see his teams it doesn't matter if he's in Siena, Juventus, the national team, now Chelsea, you realise his (finger)prints in his teams.
"He started with maybe not good results, but in the last seven games, to just concede one goal and win all seven, shows how good they are doing.
"He's a contender to win the Premier League from the beginning. Now maybe more than before, so it's a good test for us."
Guardiola said he had a clean bill of health for the game at the Etihad Stadium, where Chelsea lost 3-0 last season.
Captain Vincent Kompany remains sidelined with a knee injury, but Fabian Delph has overcome a groin problem and Raheem Sterling has shrugged off a knock sustained in last weekend's 2-1 win at Burnley.
City have won their last three away games in the league, but have drawn their last three home games 1-1 against Everton, Southampton and Middlesbrough.
A key figure in Chelsea's recent resurgence has been Spanish winger Pedro Rodriguez, who scored a fine, curling equaliser in last weekend's 2-1 win over Tottenham Hotspur.
Guardiola oversaw Pedro's emergence during their time at Barcelona, when they won 14 trophies together, and the City manager paid the Spain international a glowing tribute.
'He's a killer'
"I hope he doesn't perform well tomorrow!" Guardiola said.
"I have to thank him. He made me a better manager. He helped us to understand the concept of high pressing.
"He moves great between the lines and near the box he's a killer. He doesn't need any time to shoot. He's one of the quickest players when he shoots.
"I'm very happy for him that he's found stability here in England. He's a fantastic player."
Chelsea's new 3-4-3 system has unleashed the full counter-attacking potential of players like Pedro and Eden Hazard and Guardiola says it will be present a difficult challenge.
"We will be cautious when they have the ball, when they have the counter-attack. When we have the ball we want to attack as much as possible," Guardiola said.
"They are so good when they arrive (in the box), they score goals. They don't need to create too many chances to score goals. They are solid in the boxes. When that happens, you are good.
"But we are going to play with the quality players we have, attacking the best way possible. And being cautious not to let Pedro and Hazard and maybe Willian to run on the counter.
"Because they are so, so fast. Diego Costa as well. All three guys are so good on the counter-attack, so we're going to try to control that aspect and create our chances.
"Hopefully our talented players in the middle and in front can decide the game."