Officials have announced the bout will headline the UFC event, which will take place at Ericsson Globe and air on the UFC's Internet subscription service, Fight Pass.
Nelson (13-0-1) is coming off a second-round submission over Zak Cummings at a UFC Fight Night event on July 19 in Dublin. The Icelandic welterweight is 4-0 overall in the Octagon, with three submission finishes.
The 26-year-old Nelson had expressed interest in a matchup against highly ranked Rory MacDonald, but MacDonald (17-2) is scheduled to fight Tarec Saffiedine on the same date as the Nelson-Story bout in Halifax, Canada.
Story (17-8) has alternated wins and losses in his last eight fights. The Washington-based welterweight, now fighting out of the MMA Lab in Glendale, Ariz., is coming off a submission win against Leonardo Mafra Texeira on July 16.