Nagelsmann, 32, took the helm in June and will lead Leipzig into their second UEFA Champions League campaign after they finished third in the German top flight last term.
The club's hierarchy will hope he can continue the incredible success he achieved with former side Hoffenheim, and Nagelsmann is upbeat about the squad's goals in domestic competition.
Speaking at the International Coach Congress in Kassel, he said: "I think we are able to challenge Bayern, but it's not just about Bayern.
"There are many interesting teams this year, with many new coaches and changes."
Bayern have dominated the Bundesliga in recent years, winning the last seven incarnations.
But that run looked like coming to an end last season, before Niko Kovac's side overcame a seven-point deficit in early February to pip Borussia Dortmund to the trophy.
The title race came down to the very last day of the league season, with both teams winning to see Bayern maintain their slender two-point lead.
Nagelsmann expects the upcoming campaign to be even more open, adding: "I believe that this is one of the most balanced Bundesliga seasons for a long time.
"It is important that we all try to be ambitious and that it is exciting for everyone, both down and up the league."
The young coach has already set about reshaping his new squad, and seems set to stick with his own commitment to youth as he looks to make his mark on the club.
Ademola Lookman, the 21-year-old forward signed from Everton, is actually the oldest of Leipzig’s four permanent signings so far this summer.
Midfielders Christopher Nkunku and Hannes Wolf are 21 and 20 respectively, while Brazilian left-back Luan Candido is just 18.
With one final pre-season match against Aston Villa and an early cup fixture against second-tier Osnabruck still to come, the new boys – Nagelsmann included – will be hoping to settle in quickly ahead of the league opener on August 18.
They face an intriguing trip to Bundesliga new boys Union Berlin, whose promotion last season was one of the stories of the European football season.