The French league leaders salvaged a 2-2 draw from the first leg of the quarter-final tie against Barcelona in Paris last week thanks to an injury-time equaliser from Blaise Matuidi.
Ancelotti is under no illusions about the task presented by facing what he believes is the best club team in the world, but is nevertheless relishing the challenge.
"I'm not worried about Barcelona, we are delighted to be here because it's going to be a fantastic night," the Italian said.
"We may not have much of a chance of winning but we have a small chance.
"We played well in the first leg, against a fantastic team, and this time we will try to take advantage of the chances we get."
Barcelona's record scorer Lionel Messi is a doubt owing to a hamstring injury he picked up in the first leg, but Ancelotti says his tactics will not be affected by Argentina international.
"The strategy won't change if Messi plays or if he doesn't play," Ancelotti said.
"The key is being confident and showing personality. Playing in the Nou Camp will be difficult, because we will be playing against the best player and the best club in the world, but we have to think about our strong points, not our errors.
"We will use all our best qualities. We have to be strong and solid, pass the ball around well when we have it, and we need to be patient."
The coach did not reveal whether David Beckham, who started the first leg, would play on Wednesday night but did defend the former England captain from the criticism he received for his performance in Paris.
"Some players get criticised while others don't," he said.
"I'm happy with Beckham. That doesn't mean he's going to play tomorrow [Wednesday], but if I'm happy with how he's been playing, then he can be too."
Thiago Motta, who missed the first leg with a groin injury, has not yet been declared fit, and Ancelotti exercised caution when talking about whether he would play.
"He's an important player and it would help us if he was available, but this isn't the end of the season, we've got some other important games left and we need to bear that in mind too," he said.
Full-back Maxwell, who played for Barcelona between 2009 and 2012, said PSG's performance in the first leg gives them reason to believe they can win on Wednesday, and called on his team-mates to stay focused when faced with a team that will have considerably more possession than them.
"Here you have to show a lot of courage and personality to deal with that, because Barca control the majority of the game," he said.
"We have to be clever with the ball when we get it back. We will try to be aggressive from the first minute and attack with strength."