The Reds could find themselves in a group with Barcelona, Borussia Dortmund and Inter Milan as a worst case scenario.
Liverpool are set to face a nightmare draw in the Champions League group stage.
Last year's beaten finalists have been placed in pot three for Thursday's draw, due to their standing in the UEFA coefficient rankings.
Jurgen Klopp's men would have been given a more favourable place in pot two of the draw if both Benfica and FC Basel were eliminated in the qualification process.
Basel failed to progress, but Benfica made the all-elusive group stage with a thumping victory away at PAOK of Greece on Wednesday night.
As a result, Liverpool were confined to pot three.
So who could we potentially see paired together in the group stage (remember, teams from the same league cannot be drawn to the same group), which teams are the pushovers and which ones are the potential spoilers? Let's take a closer look.
POT 1
Real Madrid, Atletico Madrid, Barcelona, Bayern Munich, Manchester City, Juventus, Paris Saint-Germain, Lokomotiv Moscow
ANALYSIS: One of these things is not like the others... Lokomotiv Moscow will be a top-seeded team in name only regardless of its group outcome, riding UEFA's country coefficient to a potentially more favorable path. The seven others are all realistic favorites to win the competition, with last season's runner-up, Liverpool, also in that mix. Should Liverpool wind up in Lokomotiv's group, the eight chief contenders would be distributed evenly across the group stage, and should each win its respective group, it'd make for the most balanced and intriguing set of knockout clashes in some time.
It's all about taking care of business, though. Finish second, and you open yourself up to a brutal last-16 draw. Just ask last season's PSG, which cruised through the group stage before a loss to Bayern Munich in the finale dumped the club into second and an eventual knockout date with Real Madrid.
POT 2
Borussia Dortmund, Porto, Manchester United, Shakhtar Donetsk, Benfica, Napoli, Tottenham, Roma
ANALYSIS: No matter what, the top-seeded teams are going to get a challenge from this octet, but on the face of it, Napoli (remember, Carlo Ancelotti has had just a little bit of success in this competition), Tottenham, Dortmund and last season's surprise semifinalist Roma present the toughest opposition. Manchester United has the talent on paper to compete with anyone, but its current instability under Jose Mourinho makes European success seem like a pipe dream at the moment. But put United in Lokomotiv Moscow's group, and suddenly a path to the knockout stage isn't so unreasonable.
Shakhtar is the lightweight of the bunch after selling off Fred (to United) and Facundo Ferreyra (to Benfica), two of the key figures in its run to the round of 16 last season.
POT 3
Liverpool, Schalke, Lyon, Monaco, Ajax, CSKA Moscow, Valencia, PSV Eindhoven
ANALYSIS: Liverpool's presence in this pot, as opposed to Pot 2, makes for some serious Group of Death potential. It can't be paired with Man City from the top pot, but if it winds up not drawing Lokomotiv Moscow, you could be looking at a potential Barcelona-Dortmund-Liverpool triumvirate, for example. Factor in Inter Milan from the fourth pot, and you've got must-watch games all over this group. Of course that's just one permutation out of many possibilities, but you see where this could be going. Jurgen Klopp's finalists are stronger than they were a season ago and are the ultimate wild card in this draw–but this pot has many potential banana peels for the favorites.
Valencia also has the ability to make some noise. Its sneaky-good summer saw Goncalo Guedes, Michy Batshuayi, Kevin Gameiro join World Cup standout Denis Cheryshev among the club's additions, and it's already gone toe-to-toe with Atletico Madrid in league play. PSV Eindhoven, led by breakout Mexican star Hirving Lozano; Lyon, with France World Cup winner Nabil Fekir; Schalke, the Bundesliga's reigning runner-up featuring American Weston McKennie; and Ajax, with veterans like Klaas-Jan Huntelaar and Dusan Tadic complementing rising stars Hakim Zayech and Kasper Dolberg, all make for intriguing opponents.
All in all, this group has some of the most vibrant home atmospheres in Europe and boasts some of the top young talent in the world.
Inter Milan, Juventus and AC Milan have all been busy in the transfer market this summer.
POT 4
Viktoria Plzen, Club Brugge, Galatasaray, Inter Milan, Hoffenheim, Young Boys, AEK Athens, Red Star Belgrade
ANALYSIS: Inter Milan may be off to a wobbly start in Serie A, but the club added valuable pieces this summer like defenders Stefan De Vrij and Sime Vrsaljko, midfield cog Radja Nainggolan and rising Argentine attacking star Lautaro Martinez and could gel into a dangerous Pot 4 side, making for a final piece in any group of death. Playing Galatasaray and AEK Athens away is a challenge all unto itself, but neither should upset the apple cart too much in group play. Hoffenheim would be the other side clubs will want to avoid, with RB Leipzig-bound manager Julian Nagelsmann out to prove himself on the biggest stage. Its season-opening loss to Bayern had some bright moments, and the club won't shy from a top challenge.
More to read: Champions League 2018-19 group stage draw - All you need to know