The former EastEnders actor will play experienced nurse Simon Marshall, who arrives on screen in the spring.
Simon is billed as a charming and quick-witted character, who is not afraid of standing up to his superiors and undermining hospital hierarchy with his humour.
Show chiefs have also teased that he is "sure to set some hearts racing on Keller".
Nicholls commented: "I'm delighted to be joining as a guest on Holby City - it's a programme I've always admired and I'm thrilled to be part of this particular storyline. Simon is a confident guy and is sure to be in his element - I can't wait to get stuck in."
Holby City's executive producer Johnathan Young added: "Paul is an actor with a fantastic pedigree and we are delighted he'll be joining Holby City for a few months. I can't give too much away at the moment, but his character is definitely going to have an impact and ruffle a few feathers."
Nicholls will make his on-screen debut in May.
> Paul Nicholls: 'I can't remember EastEnders'
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