The 29-year-old has been plagued by Achilles problems over the last two years.
But the second-row who played all three Tests against the Lions in 2005 is ready to restart his career.
Williams will spend a month in the English Championship to gain match time, before linking up with the Blues in the Super 15 with an ultimate goal of making the World Cup.
"I can't wait to get my boots on and make an impact," said Williams.
"My ultimate goal is to get fit and to try to play my way back into the All Blacks' World Cup squad.
"Playing for Nottingham is the first step along that route. I don't know too much about the team or the standard of rugby in the Championship, but I'm sure I'll learn a lot in the next few days.
"I told Wayne Smith, the All Blacks assistant coach, I wanted to play some games in order to get match-fit and he said he had this friend in Nottingham who could help out, so here I am.
"It's been really good to meet up with the squad and I'm sure I'll fit in well. I can't wait to get my boots back on and try to make an impact for Nottingham.
"The club's ambition is to make the Premiership and I'd love to think that I could help them towards that goal."