Chiefs midfielder Seta Tamanivalu and Blues prop Ofa Tu'ungafasi are the other new entrants, the former in the mix to replace Conrad Smith and Ma'a Nonu and the latter brought in due to his ability to play both sides of the scrum.
Hansen said of McKenzie: "He's been in form. He's exciting. He's still got a lot of things in his game that he needs to grow and work on and you'd expect that from a young guy.
It's an opportunity for us to not only look at the now but also the future."
Selector Grant Fox, a former All Blacks first-five said of the little 21-year-old who can play fullback or No10: "He makes things happen. When he gets his hands on the ball or is around the ball he's a threat... he's very explosive for a little guy.
"He's one of these guys who - I think it's pretty obvious - is a case of not if he will be an All Black but when."
Of Squire, a 25-year-old impressing in the deep south after moving there from the Chiefs, Hansen said: "His tackling is very dominant. He's got X-factor when it comes to ball carrying. As a forward he's extremely quick and he has a high workrate."
Squire's teammate Dixon falls into the same category. "He's a big part of what the Highlanders are all about," Hansen said. "He's very physical, he asks a lot of questions of the opposition so now's the time to see whether he can do that at international level.
With Tamanivalu in the midfield mix, plus the relatively inexperienced Ryan Crotty, Malakai Fekitoa and Charlie Ngatai, the absence of veterans Nonu and Smith has been brought into sharp relief.
"Midfield is obviously the big thing that people have been talking about with Conrad and Ma'a leaving and Sonny not being available. We've got a young group in that midfield and we've got to get a combination going pretty quickly," Hansen said.
One player celebrating a return is fullback Israel Dagg, not selected for the World Cup due to injury, and playing superbly for the Crusaders after a late start to the season.
"He's been an outstanding All Black in the past," Hansen said. "He had a season last year where he was really affected by injury and ran out of time to prove to us he was ready to go to the World Cup. Like other guys who have had a good off season he's come back an played extremely well. He looks really sharp. He has always been good under the high ball and he's continued to do that and his defence has improved from where it was."
All Blacks squad to face Wales:
Forwards
Hookers
Dane Coles (Wellington, 36 Tests)
Codie Taylor (Canterbury, four Tests)
Nathan Harris (Bay of Plenty, two Tests)
Props
Wyatt Crockett (Canterbury, 45 Tests)
Charlie Faumuina (Auckland, 33 Tests)
Owen Franks (Canterbury, 78 Tests)
Joe Moody (Canterbury, 11 Tests)
Ofa Tu'ungafasi (Auckland, new cap)
Locks
Brodie Retallick (Hawke's Bay, 47 Tests)
Luke Romano (Canterbury, 22 Tests)
Patrick Tuipulotu (Auckland, seven Tests)
Samuel Whitelock (Canterbury, 73 Tests)
Loose Forwards
Sam Cane (Bay of Plenty, 31 Tests)
Elliot Dixon (Southland, new cap)
Jerome Kaino (Auckland, 67 Tests)
Kieran Read, captain (Canterbury, 84 Tests)
Ardie Savea (Wellington, new cap)
Liam Squire (Tasman, new cap)
Backs
Halfbacks
Tawera Kerr-Barlow (Waikato, 20 Tests)
Aaron Smith (Manawatu, 47 Tests)
First five-eighths
Beauden Barrett (Taranaki, 36 Tests)
Aaron Cruden (Manawatu, 37 Tests)
Lima Sopoaga (Southland, one Test)
Midfielders
Ryan Crotty (Canterbury, 15 Tests)
Malakai Fekitoa (Auckland, 13 Tests)
Charlie Ngatai (Taranaki, one Test)
Seta Tamanivalu (Taranaki, new cap)
Outside backs
Israel Dagg (Hawke's Bay, 49 Tests)
Damian McKenzie (Waikato, new cap)
Waisake Naholo (Taranaki, three Tests)
Julian Savea (Wellington, 41 Tests)
Ben Smith (Otago, 48 Tests)
