Jones has led his country to Grand Slam glory and his club to EDF Energy Cup success so far this year, while Williams outshone current IRB Player of the Year Bryan Habana when Wales toured South Africa having already been voted player of the tournament during the Six Nations.
The Welsh duo were two of the more memorable Lions performers in 2005, with Jones joining the tour as a late replacement to play his part in all three Tests and Williams scoring five tries in a single game before being called into the squad for the second rubber in Wellington.
"Shane Williams has been in sparkling form and not only lit up the Six Nations but also shone on our tour to South Africa in the summer," said Wales coach Warren Gatland.
"Ryan returned from injury just before the Six Nations to lead from the front and the leadership role he fulfils has been integral to our achievements and should not be underestimated.
"To have two player's recognised in the top five of the world game is the highest accolade and the nation, together with all of the Wales coaches and national squad, should take great pride in that fact."
Jones and Williams are joined on the five-man shortlist by a Scotsman who many see as a leading contender to be a key figure in nine months time having been unlucky to miss out on a Lions berth the last time.
Edinburgh scrum-half Mike Blair has been rewarded for a fine season in which he has kept 2005 tourist Chris Cusiter out of national colours and established himself as one of the leading No9s in the world game.
New Zealand outside-half Dan Carter, the Lions' nemesis on their last tour, and Italy's back row star Sergio Parisse complete the shortlist.
The nominees were selected by an independent panel of judges who have given their verdict on every major Test match this year. Former internationals Tana Umaga, Raphael Ibanez, Will Greenwood, Francois Pienaar, Agustin Pichot, Gavin Hastings, Scott Quinnell, Paul Wallace and John Eales watched over 47 hours of action from 35 matches, awarding points to the three players they thought stood out in each match.
The winner of the award will be announced in London on November 23.