The Swiss star entered the Rotterdam Open this week in a bid to close the 155 gap at the top of the world rankings.
Federer beat Ruben Bemelmans in the first round yesterday and he now requires just two more wins to reach the semi-finals to overthrow Nadal.
But until that moment happens the 36-year-old is keeping his feet on the ground to try and battle his way to success.
The 20-time Grand Slam title holder believes his biggest battle is mentally to try and stay composed when knowing how much is riding on the next two matches.
“It would be absolutely incredible. I can’t believe I’m this close, but as number one has never been simple, never easy to get there,” Federer told Tennis TV.
“So I know it’s going to be a lot of hard work for me this week, mentally, just to cope with everything.
“Also, not thinking too far ahead of the next week, or the following.
“Because I’m not there yet, and as long as you’re not number one, you’re not.
“It’s that simple.
“It would mean a lot also to my team, my family, my fans, everyone that’s been so supportive along the way.
“My comeback since 2016 has been so incredible that we’re always happy as is but I thought i’d give it a go and see if I can get to world number one this week.”
Federer returns to action against Philipp Kohlschreiber this evening (6.30pm).