With some fearing a return to a hard border between northern and southern Ireland, Nicholson told Parliament, "Be under no illusion this is going to be a massive challenge."
The ECR group deputy, who was speaking on Wednesday, added, "It should be made clear that it is not politicians in Brussels or Dublin who speak for the people of Northern Ireland. It is the people of Northern Ireland themselves who will decide their future and no one else."
Nicholson was speaking in Strasbourg in a debate on the European Council's Brexit negotiating guidelines which were agreed at a summit in Brussels last week.
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He said, "I am very concerned at the way this Brexit process is going because we have megaphone diplomacy coming from across the Channel instead of the clear heads that will be needed to resolve these issues.
"I hope both sides will realise that this is this way to move forward."
The UK Conservative delegation leader Ashley Fox told MEPs, called for an early start to talks on Britain's future trading relationship with the EU, stressing that was the best way to ensure a successful outcome.
He added, "We don't want a hard border between Northern Ireland and the Republic. It is though, difficult to discuss how that might work without knowing what sort of trading relationship we will have.
"The UK wants a deep and special partnership with the EU. We want a comprehensive agreement on both our economic and security relationships. We want you to prosper after we have left."
EPP group member Elmar Brok said, "Last week I was in Belfast and had meetings with people from civil society who said they are perplexed about what is going to happen. I pray for realism in London and for the UK to realise a hard Brexit would be a disaster for Britain and Northern Ireland."
Brok added, "We need a sense of realism in order to limit the damage for both parties and avoid an escalation of nationalism in Northern Ireland."