The 'Skyscraper' hitmaker - who previously dated Nick's brother Joe - has worked on a song with her old friend for his first album since splitting from the Jonas Brothers.
Nick told E! News: ''We did one for my record. It's a great song that we both love. Her voice is just amazing on it. She's the real deal. It's the perfect fit for this record.''
This come after Nick surprised fans on the opening night of Demi's 'Neon Lights' tour in Vancouver in February when he joined her on stage.
The duo belted out three tracks, 'Stop The World', 'Catch Me' and 'Here We Go Again' together, while Nick, 21, played the guitar.
The 21-year-old beauty had originally hired the hunky star as the musical and creative director of her tour a few months ago.
Nick said previously: ''I'm overseeing video content, wardrobe, lighting and staging. And then I'm extending into the musical side of things, which includes creating the arrangements for the songs.
''I'm building what Demi wanted, which is a show without stops and starts.''
The performer has been close friends with Demi for a number of years and wanted to make sure he did her proud.
He continued: ''I was immediately excited when I was offered the position. The relationship that Demi and I had over eight years really gives me the insight into how to best communicate with her and her team.''