Scarlets player Priestland reclaims the number 10 shirt he last wore when Wales beat England in a tournament warm-up game at the Millennium Stadium four weeks ago.
The versatile James Hook again features at full-back, forging a menacing Wales back-three alongside wings George North and Shane Williams.
Elsewhere, Wales coach Warren Gatland has sprung a surprise in the second-row, where Newport Gwent Dragons lock Luke Charteris is preferred to Cardiff Blues forward Bradley Davies.
Calf muscle injuries sideline fly-half Stephen Jones, prop Gethin Jenkins and number eight Ryan Jones, while 2009 Lions first Test full-back Lee Byrne does not feature in the matchday 22.
Leigh Halfpenny provides back-three cover off the bench, and Byrne, who had a poor game in Wales' final warm-up fixture against Argentina, misses out completely.
There are three changes from the side that defeated England, with centre Jonathan Davies, hooker Huw Bennett and prop Adam Jones all claiming starting places.
Priestland, 24, made his Test debut as a replacement against Scotland during last season's Six Nations Championship, and he has won just four caps.
But Gatland has been impressed with his maturity and composure, which was highlighted by an assured display against England at Twickenham last month.
On that occasion, Priestland moved from full-back to fly-half with barely 10 minutes' notice when Jones' calf tightened during the warm-up.
Hook, meanwhile, had an outstanding game from full-back in the return England encounter seven days later, contributing 13 points that included a try and two long-range penalties.
Charteris is rewarded for impressive regional form with the Dragons, and at 6ft 9in tall he should offer Wales a considerable lineout presence as they target only their second victory in 26 attempts against South Africa.
Gatland said: "We are going into this game looking for a win.
"If you get the world champions in your pool, you want to play them first-up and throw everything you've got at them.
"We've got the toughest group in the competition, but we know if we can come through we will be in good shape.
"The players have done everything we have asked of them so far. They have worked incredibly hard."
And Sunday will be a red-letter day for Wales skipper Sam Warburton who, at 22 years and 341 days, becomes the youngest captain in Rugby World Cup history.
Full team: J Hook (Perpignan); G North (Scarlets), J Davies (Scarlets), J Roberts (Cardiff Blues), S Williams (Ospreys); R Priestland (Scarlets), M Phillips (Bayonne); P James (Ospreys), H Bennett (Ospreys), A Jones (Ospreys), L Charteris (Newport Gwent Dragons), A-W Jones (Ospreys), D Lydiate (Newport Gwent Dragons), S Warburton (Cardiff Blues, capt), T Faletau (Newport Gwent Dragons).
Replacements: L Burns (Newport Gwent Dragons), R Bevington (Ospreys), B Davies (Cardiff Blues), A Powell (Sale Sharks), T Knoyle (Scarlets), S Williams (Scarlets), L Halfpenny (Cardiff Blues).
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