The 22-time Grand Slam champion had said he would not keep playing if he continued to need anaesthetic injections in his left foot, BBC reported.
However, the Spaniard had treatment last week to reduce nerve pain and is planning to play Wimbledon, which begins on 27 June.
"The last week of training tells me there is a chance," Nadal, 36, said.
"My intention is to play at Wimbledon."
He said he would travel to London on Monday and play in the exhibition event at Hurlingham, which begins on Tuesday.
The two-time Wimbledon champion has been practising on the grass courts in Mallorca to test his fitness.
"I'm happy, I haven't been limping for a week," Nadal said.
"I have noticed changes with the treatment – I still have strange sensations, sometimes I can't feel my foot, but the pain that did not allow me to support my weight on my foot has subsided."
Nadal has a rare degenerative condition called Muller-Weiss syndrome, which affects the bones in the feet, and last year feared his career was over because of the condition.
However, he started the year in stunning fashion, winning the Australian Open to secure a men's record 21st Grand Slam title.
He then went on to win a record-extending 14th French Open title last month but needed multiple injections in his foot throughout the tournament.
Nadal underwent radiofrequency ablation treatment – a procedure which uses heat on the nerve to quell long-term pain – after returning from Paris last week.
He missed last year's Wimbledon to give his body time to rest after his loss in the French Open semi-finals.
He reached the last four on his last appearance at Wimbledon in 2019, with the 2020 tournament cancelled because of the coronavirus pandemic.
"I haven't played on grass for three years and I have to adapt," Nadal said.
"Every day I have been recovering sensations and feeling better. I have a week left before playing and I have to test myself little by little."