The Oscar and Emmy nominee, 51, steps into the role of the crooked head of an orphanage for the network's live show, airing Dec. 2 and also starring Harry Connick Jr. as Daddy Warbucks and 12-year-old newcomer Celina Smith as Annie. And PEOPLE has your first look at Henson as the classic villain.
"Playing the villain is always fun," Henson tells PEOPLE in this week's issue. "With Miss Hannigan, there is so much to work with and dig deeper into. It's just such a fun and iconic character to play."
While Henson has yet to tap any of the other actresses who've played Miss Hannigan in the past, she's quick to share her admiration for the one who remains ingrained in most Annie fans' minds: Carol Burnett, who played the role in the 1982 film.
"Carol Burnett will always be one of my all-time favorite artists and biggest inspirations," she says.
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As for the live element, the Empire alum is mostly unfazed.
"There's always some butterflies when it comes to doing live events, but that's part of the fun," she says. "My roots are in theater, so it's just a great opportunity to jump back into what I grew up doing and it's also a challenge, which I find exciting."
She adds, "As an artist, nerves and nervousness is natural. You need that energy: it means you are alive and in the moment. I welcome nervousness because that is energy to use. It is not a bad thing."
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Henson's excitement about the project extends to its timing, just as families are coming together to celebrate the holidays.
"Holidays are an opportunity to bring people together and prioritize happiness and, for me, that's what musicals do," she says. "They're joyous and fun and make you think and just make you feel as though you're part of a larger community."
Annie Live! airs Dec. 2 at 8 p.m. ET on NBC.