Waugh and former Test wicketkeeper Brad Haddin also believe Lyon holds the key to Australia's success against the Proteas after the off-spinner roared back to form at the weekend.

Australia will name its squad on Friday ahead of the opening Test against South Africa, with former ACT Comet Lyon set to keep his spot and Canberra junior Jason Behrendorff tipped as a potential bolter.

Lyon is the greatest off-spinner in Australian Test history and has cemented his place in the team.

However, he was publicly singled out by coach Darren Lehmann and captain Steve Smith for poor results after a 3-0l series loss to Sri Lanka in August.

Waugh described the criticism as unfair, saying Australia's batsmen should have been put under the blowtorch instead of Lyon.

But Waugh, who will ride through Canberra next week as part of a 700km 'Captain's Ride' journey to Mt Kosciuszko to raise money for children with rare diseases, is convinced Lyon has "something special".

"I'm a big fan of Nathan and his cricket, I really like his attitude," said former Test skipper Waugh.

"When he first came in he was throwing the ball up to someone like [Sachin] Tendulkar, I loved seeing him get stuck into the game.

"As a captain, he's someone you love to have on your team because he loves the battle and he's not scared to put his hand up in the big moments.

"I thought he was very harshly judged in that Sri Lanka series, a lot of people pointed the finger at him for not doing the job. But I felt he did pretty well ... maybe the batsmen should have scored more runs."

Lyon bounced back to form in the best possible way last weekend, claiming 4-10 off 10 overs in the domestic one-day final to lead NSW to glory.

It came after the criticism in Sri Lanka and being axed from the one-day international squad earlier this year.

Lyon still has ambitions to be the No.1 spinner in Australia in all formats after a rise from Manuka Oval curator to international spinner.

He has played 57 Tests and taken 211 wickets — the most of any Australian off-spinner in Test history.

"The first time I saw him I knew he had something really special ... with the shape he got and energy he had on the ball," Waugh said.

"Straight away he caught my eye and he's been a real talent, his biggest asset is that he's a great competitor and he never backs down."

Lehmann will make a decision on his first Test squad on Friday with Behrendorff looming as a candidate to join Lyon, Mitchell Starc and Josh Hazlewood in the bowling line-up.

Haddin said Lyon had shown he could bowl well in Australian conditions, which are generally more suited to fast bowlers rather than spinners.

"You've just got to look at his record, he's not called the 'GOAT' [Greatest of All Time] for no reason," Haddin said in reference to Lyon's nickname.

"He is the greatest we've ever had as an off-spinner ... his record speaks for itself and I know he really, really enjoys these Australian conditions.

"I think he's ready to go, I think he complements this attack really, really well and he's a good character to have around."

Waugh will lead a group of 70 riders, including Adam Goodes and Anna Meares on the 700km trek from Bowral to Mt Kosciusko.

The group will finish in Canberra on day three of the six-day trip before moving on to Cooma. Since 2005, the Steve Waugh Foundation has supported more than 600 families battle rare diseases.