The world number one leads the field at the end-of-season tournament, which pits the best eight players of the year against each other.
Defending champion Williams was drawn with Agnieszka Radwanska, Petra Kvitova and Angelique Kerber in the red group while second seed Victoria Azarenka, Li Na, Sara Errani and Jelena Jankovic are in the white group.
Williams said: "It's a tough group. I have to be ready. That's the thing about this tournament and why it's so tough, you have to be ready from the first match on."
The American will undoubtedly be the player to beat when the tournament begins at the Sinan Erdem Dome on Tuesday.
While 2002, when she won three consecutive grand slam titles and went on to complete the 'Serena Slam', remains in some ways her peak, this season must rival it.
She has won more matches and more titles than in any other year of her career, losing just four times in 14 events.
The 32-year-old added a second French Open title to her collection in June, 11 years after her first, and in September won her 17th grand slam singles title at the US Open.
Williams' dominance continued in Asia, where she won the WTA Tour title in Beijing without dropping a set, and she heads into this week on a 10-match winning streak at the championships having won the title in 2009 and then in 2012 after a two-year absence.
While Kvitova especially is a dangerous opponent on a fast indoor surface, neither the Czech nor Radwanska has ever beaten Williams, while Kerber can boast one victory from three matches.
Second seed Azarenka, who has beaten Williams twice this season, is her most likely title rival, and the Belarusian is looking for her first title at the end-of-season event having lost in the final to Kvitova two years ago.
It is the first year since 2006 that all the singles players have previously competed in the championships, which is being staged in Istanbul for the final time before moving to Singapore.
Jankovic is the only player to qualify this year who was not in the field 12 months ago, with the Serbian back among the top eight of the season for the first time since 2010.
Maria Sharapova, the beaten finalist last year, is the player to miss out, although the Russian did qualify but pulled out with the shoulder problem that has kept her sidelined since before the US Open.
Having ended 2008 as world number one, Jankovic began this season outside the top 20 but has been quietly impressive, winning a title in Bogota and reaching two more finals, both of which she lost to Williams.