The visitors were 356 for seven at stumps on day one of their Plunket Shield game against the Volts at the University Oval.
Otago worked hard for their wickets, but Nicholls is in a tremendous patch of form and he clocked his 20th first-class century.
His 111 was the cornerstone.
But Black Caps test captain Tom Latham will be satisfied with his innings of 52.
Mitch Hay chipped in with 42, and lower-order players Ish Sodhi (41 not out) and Sean Davey (29 not out) took advantage of a tiring Otago attack on a scorching day in Dunedin.
Spinner Glenn Phillips was the pick of the Otago bowlers. He nabbed two for 65 from 20 overs.
Otago shelved a couple of early opportunities.
Chad Bowes was dropped on 14. Max Chu bobbled it and almost reeled it in on his second, third and fourth attempts, but it remained frustratingly out of reach for the gloveman.
Rhys Mariu offered a sharp chance in the slip cordon on 14 as well.
Neither player pushed on.
Otago captain Luke Georgeson trapped Bowes lbw for 18.
Mariu (14) mistimed a pull shot off Jarrod McKay.
Tom Jones made the catch at square leg and it took some effort. He had to run backwards while looking over his shoulder.
The wind threatened to take the ball out of reach, but he put in a few late and desperate strides to close the gap and complete a difficult pouch.
Latham and Nicholls added 80 for the third wicket.
But just before the lunch break, Latham was snookered by Phillips.
The offspinner tossed it up and lured the left-hander into a drive. Georgeson took a regulation catch at first slip.
Canterbury went to lunch at 133 for three.
Matt Bacon bowled beautifully after the resumption and was mostly unlucky until Matt Boyle (10) sliced a catch to Ben Lockrose in the gully.
Nicholls’ class really started to shine through then.
He brought up his century with a reverse sweep off Lockrose.
He has notched two list A hundreds for Canterbury this season as well, so he is a man in form.
Nicholls seemingly had an inexhaustible amount of scoring options but was in no hurry either.
Given Canterbury came into the game with arguably a long tail, the value of the partnership was not lost on Nicholls, or Hay who batted sensibly down the other end.
The Volts were just one good piece of cricket away from exposing the lower order.
Nicholls was eventually undone when he flirted with a wide short delivery. Chu took a comfortable catch at about chest height.
McKay snuffed out the partnership two runs shy of a hundred.
Phillips then went to work removing Hay.
The spinner had switched ends and fussed long and hard on the positioning of Lockrose at extra cover.
Hay sliced the first ball over Lockrose’s head and then knocked a single in the direction of Lockrose.
But Phillips insisted Lockrose hold his ground and bingo!
Hay chipped the last ball of the over straight to him. It was an inspired piece of bowling.
In the other games, Wellington are 196 for three against Central Districts at the Basin Reserve.
Tim Robinson is poised on 94 not out.
Auckland are 302 for eight against Northern Districts at Bay Oval.
CANTERBURY
First innings
T Latham c Georgeson b Phillips 52
C Bowes lbw Georgeson 18
R Mariu c Jones b McKay 14
H Nicholls c Chu b McKay 111
M Boyle c Lockrose b Bacon 10
M Hay c Lockrose b Phillips 42
I Sodhi not out 41
A McKenzie c Georgeson b Ferns 15
S Davey not out 29
Extras (6b, 10lb, 7w, 1nb) 24
Total (for seven, 96 overs) 356
Fall: 1-29, 2-51, 3-131, 4-149, 5-247, 6-262, 7-297.
Bowling: L Georgeson 15-2-47-1, D Ferns 16-0-69-1, M Bacon 17-4-55-1 (1w), J McKay 15-2-58-2 (1nb, 2w), G Phillips 20-2-65-2, B Lockrose 13-0-46-0.
