Paatelainen, who quit as Hibs boss in May 2009 and returned to Scottish football with Killie this summer, hopes his side will come out on top against his former club in the third round clash.
He fully expects Hibs to at least replicate last season's efforts once they are fully up and running and is keeping his fingers crossed it takes them a while longer to rediscover their form.
Paatelainen said: "This is a very tough match for us, Hibs are a good team.
"They qualified for Europe last season and, in my books, they will qualify for Europe this season as well.
"They have had a sticky start but they have wonderful players and the same management as last year and I wouldn't be surprised if they qualified for Europe again.
"They are not firing on all cylinders yet and hopefully it stays that way at least until after this game.
"We know they are well capable of beating anybody, Old Firm included, and we are facing a very difficult match."
Following a close brush with relegation last term, the Scottish Premier League will be the priority for Kilmarnock but Paatelainen also wants a decent cup run.
"It's very important for us," he said.
"We want to be successful in every single match and we don't treat this game any differently to the league games. It's exactly the same.
"We are facing SPL opponents and it's a very important game so we will treat it accordingly."
Meanwhile, defender Jonathan Grounds hopes Hibs can find solace in the cup.
They were booed off the pitch following successive 1-1 home draws against Inverness and Hamilton in the SPL which extended their winless Easter Road run to nine games in all competitions.
The league cup clash with Kilmarnock at Rugby Park is the first of three straight away fixtures, with Hibs looking for a victory to ease the mounting pressure on manager John Hughes.
"You always look for a good cup run," said Grounds, who joined on loan from Middlesbrough at the end of the summer transfer window.
"And it will be important for us to get a few good results before the (international) break.
"The two results while I've been here have been a little bit disappointing.
"But the league's so tight that if we string a couple of results together we could be near the top.
"Hopefully a good cup result on Wednesday can kick us on for a good performance at Celtic at the weekend.
"One victory could push us up to third or fourth in the table which makes for better viewing."