The Welshman failed to make an impact in an unusual position as a false number nine and was substituted after an hour in his first experience of the biggest game in European football as Real lost 2-1 to Barca at the Camp Nou back in October.
However, Bale has since recovered from the injury problems that blighted his first few months in the Spanish capital after his huge summer move from Tottenham Hotspur and has gone on to score 14 goals and provide 17 assists in just 31 appearances.
"In the first game he was switching positions with (Angel) Di Maria at times, but now he is used to playing on the wing and the team is balanced so we won't change that," Ancelotti told his pre-match press conference on Saturday.
"He is in good shape. His physical condition is very important for him and I am sure he will play a great game.
"We haven't done any special work with him to improve his fitness or speed. He just has great genes and has done the same work as everyone else.
"He is in really good condition and we are very happy with him. He had some problems at the start of the season but now he is looking good and we hope that will continue until the end of the season."
Real go into the game full of confidence as they haven't been beaten since that defeat at the Camp Nou nearly five months ago.
A run of 31 games unbeaten in all competitions has seen them open up a four-point lead over Barca at the top of the table, but Ancelotti claimed that that advantage doesn't ease the pressure on his side to win at home.
"A Clasico is always important and always brings pressure. The game is very important for the league and a Clasico is always distinct to the other games.
"Our idea is to be able to show our quality. We are desperate to play this game. We need to do what we have done well up until now which is attacking and defending well as a group."
Ancelotti confirmed that French striker Karim Benzema had recovered from the thigh injury that kept him out of Wednesday's 3-1 win over Schalke meaning he will be fit to start alongside Cristiano Ronaldo and Bale in attack.
The trio have managed 76 goals between them this season, but Barca can boast a frightening strike pairing of their own as Brazilian star Neymar looks set to partner Lionel Messi up front for the Catalans.
And Ancelotti said Real's midfield and defence will have to work together to deny the South American duo space.
"It is normal that we have to be very careful with them. It is not an individual's job, but about working together. We have to be very compact."