And with only a few players based outside their respective countries, both squads are used to facing up to each other on a regular basis.
"It is certainly a tough rivalry," said O'Connell, whose team clinched their 2009 Grand Slam with a win in Wales.
"A lot of us got to know each other on the Lions tour to South Africa in 2009 and we play against each other in the Pro 12 every week and the Heineken Cup and Six Nations year after year.
"There is no doubt there is an edge to it. It is a great fixture and some of the games have been brilliant, high-intensity, physical encounters. I expect it will be no different this time."
The last time the two sides met it was the Welsh who came out on top in a pulsating World Cup quarter-final in Wellington, New Zealand.
Irelandhad been the favourites to progress that day but Wales produced an outstanding display to march on to the final four.
It's a painful memory for O'Connell and co and the giant second row admits it will provide a little extra motivation for the Aviva Stadium encounter a week on Sunday.
"That was certainly a big disappointment and hopefully we can put it right next weekend," said O'Connell, speaking just days after Munster, Leinster and Ulster gave Irish rugby a huge boost by making it through to the quarter-finals of the Heineken Cup.
"We had a good World Cup until then and played well against Australia and Italy, but we just didn't perform to the best of our ability against Wales, certainly in that last half hour, when we conceded two soft tries to effectively hand the game to Wales.
"I suppose it was a good thing a lot of us went away from the disappointment against Wales and managed to put some good performances together. It gets that performance at the World Cup out of the system for a lot of us.
"It's great that we have all come into camp off successful Heineken Cup campaigns and there is a really good atmosphere around the squad.
"But we won't be able to afford anything below our potential. We need to produce a massive performance."