The Wallabies' number 10 says Russell is "world class" and unfortunate not to be on the British and Irish Lions tour.
"Finn Russell is a very dangerous player," said Foley. "He has all the tricks of the trade.
"He's a major threat for us this weekend and someone will have to contain him."
Glasgow Warriors' Russell, 24, will win his 29th cap at the Allianz Stadium, having set up two tries in last weekend's 34-13 win over Italy in Singapore.
A penalty and a conversion nudged his international points total to 66, some way behind the 429 Foley has amassed in 43 Test appearances.
"I thought he was unlucky to miss out on that Lions squad," added Foley on his opposite number.
"He's a form 10 in the northern hemisphere. His ability to run, pass and kick is world class."
Foley, 27, wrote his name into the history of this match when breaking Scottish hearts with a 79th-minute penalty to clinch an epic World Cup semi-final at Twickenham in 2015.
Then he did it again in the autumn of 2016 when putting over a late match-winning conversion to win a Test at Murrayfield.
There was just a single point in both games at the end.
"It's up there with the best," Foley said of his nerve-shredding World Cup kick against Scotland.
"It was a pretty stressful moment. It had every bit of emotion you could feel. We were easily on top but, in the 73rd minute, we were down.
"(The drama) is all we know against the Scots. They're a class outfit and they play a style that really suits them, especially now with their new coach, Gregor Townsend. We can expect a lot of flair and entertainment.
"Every time I've played against them it's been a battle that's been fought all the way to the death.
"I'm sure this will be another one on Saturday. We saw against Italy the ability the Scots have to score tries. The last two games could easily have gone the either way."
Australia stand-off Bernard Foley thinks counterpart Finn Russell is the Scottish player the home side must be wary of in Saturday's Test in Sydney.