The world number two, who recently won a record seventh French open title, has won 11 Grand Slam tournaments.
Nadal was the unanimous choice of the COE board and local media reported he was chosen ahead of sailing duo Iker Martinez and Xabi Fernandez who have a gold and a silver from the Athens and Beijing Games in the 49er class event.
The 26-year-old will be attending his third Olympic Games. Nadal competed in the doubles in Athens in 2004 and won the singles in Beijing four years ago.
World number one Novak Djokovic will carry Serbia's flag at the opening ceremony on July 27.