Glasgow City coach Eddie Black was relieved to have avoided any of the top five seeds but still expects Valur Reykjavik to be formidable opponents.
City are the first Scottish side to have reached the last 32 of the Women's Champions League.
"Valur have won their league for the last five years and been in the last 32 for the last four years and have been in the last 16," said Black.
"They lie second in Iceland this season but have a real winning mentality."
There can be no all-British clash until at least the quarter-finals after former European champions Arsenal were drawn against Bobruchanka of Belarus, with the winners facing PK-35 Vantaa of Finland or Rayo Vallecano from Spain.
The Scottish champions will meet either third seeds Turbine Potsdam of Germany or another Icelandic side, Thor/KA, should they defeat Valur over two legs.
"Potsdam have been champions twice and were runners-up to Lyon last season," said Black.
"However, while the last 16 draw was made at the same time, we cannot allow ourselves to be distracted and we must remain focused on what is a very difficult tie."
That Iceland have two representatives in the competition, courtesy of being one of the top eight countries in Europe, is an indication of the task at hand.
"The draw could have been a lot tougher, but this is a team that have for the past four seasons been involved at this stage of the competition," said Black.
"Therefore, whilst it is new to us, it is a natural situation for them.
"However, we will look to do ourselves justice and hope the public will come out in support of us in our attempt to progress to the next round."
Glasgow will host the first leg, which is likely to be on the evening of Thursday 29 September at Petershill Park in Springburn.
Meanwhile, Champions League holders Olympique Lyonnais face Romanian outfit Olimpia Cluj.