The two met prior to Biden taking office and have spoken by phone a number of times, but the -19 pandemic and Xi's aversion to foreign travel has prevented them from meeting in person.
"The leaders will discuss efforts to maintain and deepen lines of communication," as well as how to "responsibly manage competition and work together where our interests align," White House spokeswoman Karine Jean-Pierre said in a statement.
Their meeting during the summit in Bali comes after Xi last month was awarded a landmark third term as Chinese Communist Party General Secretary.
Biden, meanwhile, could have a tougher road ahead for the next two years after Tuesday's midterm elections likely left opposition Republicans in control of one, if not both, of the chambers of the US Congress.
Still, Biden is headed into the trip "with the wind at his back," White House National Security Advisor Jake Sullivan said Thursday, with "an excellent opportunity both to deal with competitors from a strong position and to rally allies."
The United States and China have a massive investment and trade relationship but are also challenging each other's military and diplomatic influence, especially in the Asia-Pacific region.
They also face a potential flash point over the self-ruled island of Taiwan, a close ally of the United States that Xi has made clear he believes should be under Beijing's control.
On Wednesday, Biden said he has already made clear to Xi that he is "looking for competition, not conflict."
Biden said they will discuss Taiwan, but added that the U.S. stance on the island "has not changed at all from the very beginning."
Also on the agenda is stepped-up missile test launches by North Korea, which the United States and allies consider a growing threat to East Asia.