Last season's Player of the Tournament for the RBS 6 Nations and a firm favourite for a first British & Irish Lions adventure this summer, Lydiate fractured and dislocated his ankle in a RaboDirect PRO12 game against Edinburgh at Rodney Parade.
He hasn't played since and missed the Autumn internationals and all five recent Championship Tests as Wales retained their title with a stunning demolition of England in Cardiff on Saturday.
Lydiate's last Wales involvement came on the summer tour of Australia and he will now hope to persuade Wales and Lions coach Warren Gatland that he should be picked to return to Oz with Britain and Ireland's elite in 10 weeks' time.
The 25-year-old was expected to return to the fold by the end of the month, with next Saturday's domestic derby with the Scarlets seen as the likely fixture for his comeback.
Dragons boss Edwards appeared to rule the star blindside out of this weekend's trip to the Ospreys, instead stating that "He should be a definite for the week after next" at a press conference a couple of days ago.
But Edwards has since selected Lydiate in his starting line up for the evening kick off in Swansea as the 27-cap flanker gets set for his first appearance in sixth months and just his fifth game of the season.
Lydiate will start in the No6 shirt for the Dragons, with Lewis Evans wearing No8 after Toby Faletau was named on the bench.
Fellow Wales star Andrew Coombs returns from international duty to start at lock for Edwards' men, while the Ospreys have named Championship winners Dan Biggar, Ryan Bevington, Richard Hibbard, Adam Jones, Alun Wyn Jones, Ian Evans and Justin Tipuric in their starting XV.
Lydiate faces a tough return against an Ospreys back row that includes last weekend's Welsh Man of the Match in the record breaking 30-3 win over England, Tipuric, Jonathan Thomas and Wales squad member James King.