Juventus are in seventh place in the league standings after three wins and four draws, four points behind Milan, who lost 3-0 at Chelsea in the Champions League this week.
"We are ready to play this match. Milan, at the moment, is ahead of us in the standings, they are a strong team and are very dangerous when the pitch is open," Allegri told reporters on Friday.
"It will take focus and character, it will be a good test for us."
Juventus can see the light at the end of the tunnel regarding injuries, with Angel Di Maria and Adrien Rabiot playing key roles in the Champions League 3-1 win over Maccabi Haifa on Wednesday after returning to fitness.
However, Di Maria will be out of the clash at San Siro due to a two-match suspension after a red card against Monza.
"Leonardo Bonucci should start tomorrow, but I will decide everything after training. Arek (Arkadiusz) Milik is better, he should be available to play," Allegri said.
Midfielder Paul Pogba and forward Federico Chiesa are still out along with striker Kaio Jorge and right-back Mattia De Sciglio who has a hamstring injury.
Allegri warned that Stefano Pioli's men would be out to prove themselves after the defeat in London.
"We're playing against the Italian champions and tomorrow will be a more difficult game than usual because they come from a bad defeat in London and will want to make up for it," Allegri said.
"They have players of great technique and speed, players like Rafael Leao who can shift the balance of a match and in addition, they'll be playing in front of their fans.
"It will be a good match, a wonderful sporting evening in a full stadium."
