Manchester United, the defending European champions, will face Celtic in the Champions League group stages following the draw in Monaco.

Sir Alex Ferguson's side, who beat Chelsea on penalties in the final in Moscow in May, were also joined by Villarreal and Danish club Aalborg in Group E.

The trip to Spain to play Villarreal will bring back bad memories for Wayne Rooney who was sent off playing against the same club in September 2005.

"It was a great event the last time we played," David Gill, United's chief executive, said. "Both clubs have passionate fans and we're looking forward to it.

"Last time they won (at Celtic) to qualify and we went down to the last game to ensure we went through. The players and the fans will already be looking to that fixture on the calendar."

John Reid, the Celtic chairman, added: "It's fabulous for Celtic fans. There are no easy groups, there are no free passes in Europe.

"We're just proud to be Scotland's representative in there and to be playing the European champions."

Chelsea have been drawn in Group A along with Roma, Bordeaux and Romanian club Cluj, while Arsenal have been drawn in Group G with Porto, Fenerbahce and Dynamo Kiev.

Elsewhere, Fernando Torres faces an emotional return to Atletico Madrid after Liverpool were drawn in Group D along with PSV Eindhoven and Marseille.

Rick Parry, Liverpool's chief executive, said: "We know all of them pretty well for different reasons… its not easy, but they’re all fairly close by so there are no long trips. There are no easy ties when you look down the groups so you take it as it comes."

On the prospect of playing Marseille for the second season running, Parry said: "Ye, there are different circumstances with Marseille… we beat them away, but lost at home – We know them well. We’ve played PSV a few times, Atletico we know for different reasons. We’re just delighted to be in it," he added

Jose Mourinho, now in charge of Inter Milan, sees his side up against Werder Bremen, Panathinaikos and Cypriot side Anorthosis Famagusta in Group B, while Barcelona were drawn in a relatively easy Group C along with Sporting Lisbon, Basle and Shakhtar Donetsk.

Lyon are joined by Bayern Munich, Steaua Bucharest and Fiorentina in Group F and Real Madrid will face Juventus, Zenit St Petersburg and Bate Borisov in Group H.

Full Champions League draw:

Group A
Chelsea
Roma
Bordeaux
CFR Cluj

Group B
Inter Milan
Werder Bremen
Panathinaikos
Anorthosis Famagusta

Group C
Barcelona
Sporting Lisbon
Basel
Shakhtar Donetsk

Group D
Liverpool
PSV Eindhoven
Marseille
Atletico Madrid

Group E
Manchester United
Villarreal
Celtic
Aalborg

Group F
Lyon
Bayern Munich
Steaua Bucharest
Fiorentina

Group G
Arsenal
Porto
Fenerbahce
Dynamo Kiev

Group H
Real Madrid
Juventus
Zenit St Petersburg
Bate Borisov