The former Tottenham team-mates will go head-to-head at the Liberty Stadium on Tuesday evening, when Wales and Croatia face off in a crucial World Cup qualifying meeting
Chris Coleman's side host Croatia at the Liberty Stadium hoping to further boost their World Cup qualification hopes following victory over Scotland on Friday.
And Swansea defender Williams believes the former Tottenham team-mates will have a big say in which way the match goes.
"Both teams have an exceptional player - them in Modric and us in Gareth Bale," he told reporters.
"For a fan watching the game, I am sure it will be a great battle. Two world-class players on the pitch should make for something good.
"I thought Modric did well when he came on for Real at United. And when we played Croatia over there, Modric was unbelievable.
|4/1||Wales are 4/1 with Paddy Power to beat Croatia
"It was probably one of the best individual performances I have played against. I don't think he gave one ball away - he controlled the whole game. He is in good form and we will have to pay him close attention.
"Sometimes you play against players and you realise they are world-class and I thought that on that night. But Gareth is also a world-class player in my eyes."
Despite Bale having scored four of Wales' last seven goals, Williams dismissed the notion that the Dragons are a one-man team.
"Anyone who knows us knows we have good players all over the team. If anyone takes the time to look at the team they will see we have a lot of good players and a lot of weapons attacking-wise. We know we are not a one-man team," he said.
"We do have a world-class player in our team and we love having him here. But it is not just Gareth Bale, one man doesn't make a team.
"If people start saying the other players in the team aren't any good then that is disrespectful."
The 28-year-old also underlined the importance of victory in the battle to reach the 2014 World Cup, adding: "If we want to do anything we have to win this game."