UFC President Dana White announced the news on Wednesday night's edition of FOX Sports Live.
A former UFC light heavyweight champion, Machida (19-4) drops down to middleweight following a controversial loss to Phil Davis at UFC 163. Prior to the setback, "The Dragon" won three of his previous four contests, knocking out Randy Couture and Ryan Bader, losing via standing guillotine to champion Jon Jones, and edging Dan Henderson via split decision.
Kennedy (16-4), meanwhile, rides into the bout fresh off a unanimous decision victory over Roger Gracie in his UFC debut. The 33-year-old has won four out of his last five contests, having been defeated only by former Strikeforce champion Luke Rockhold in that span.
UFC Fight for the Troops 3 is scheduled for November 6, 2013 in Fort Campbell, Kentucky. The event will air live on FOX Sports 1.