Modric was absent against Osasuna in La Liga at the weekend due to a muscular problem, but Los Blancos boss Carlo Ancelotti said last week that the issue was 'not very serious'.
The experienced midfielder returned to training on Monday and has been included in the squad for the European contest with Shakhtar.
Meanwhile, there is also a return for Vazquez, who has been sidelined with a muscular problem since the contest with Mallorca on September 11.
"The idea is to see if he can be there on Wednesday and then Saturday. Same idea as with Modric," Ancelotti told reporters when questioned ahead of the league game with Osasuna.
Vazquez is yet to feature in the Champions League this season, but he has played four times in La Liga and scored on the opening weekend of the campaign against Almeria.
Real Madrid are missing two first-team players for the European contest, though, with Thibaut Courtois sidelined due to an ongoing back problem.
Courtois missed out against Osasuna due to an issue with his sciatic nerve, and Ancelotti said ahead of this match that the Belgium international was also a doubt for the weekend clash with Getafe.
Dani Ceballos, who played 53 minutes of the 1-1 league draw with Jagoba Arrasate's side, is also out of the contest with Shakhtar due to a hamstring problem.
"We're without Courtois still, and he'll also be doubtful for Getafe on Saturday, and we're without Dani Ceballos too, due to a hamstring issue, but Luka Modric and Lucas Vazquez are back. I'm still not sure if Modric will start the match, though," Ancelotti told reporters ahead of the match.
Lucas Canizares is the player to benefit from Courtois's absence, with the 20-year-old being included in the squad alongside Andriy Lunin and Luis Lopez in the goalkeeping department.
Jesus Vallejo and Alvaro Odriozola have both had their injury problems in the early stages of this season, but the pair are also in the selection for this contest.
There had been a doubt over Eduardo Camavinga when the midfielder missed Monday's training session, but the Frenchman is also in the squad and will be battling for a starting role on Wednesday night.
Real Madrid squad vs. Shakhtar:
Lunin, Luis Lopez, Canizares; Carvajal, Militao, Alaba, Vallejo, Nacho, Odriozola, Rudiger, Mendy; Kroos, Modric, Camavinga, Valverde, Vazquez., Tchouameni; Hazard, Benzema, Asensio, Vinicius., Rodrygo, Mariano