Horne, who has recovered from the fracture that kept him out of the Scotland squad for the RBS 6 Nations has been given the task of orchestrating from the pivot in the top of the table battle.
The Warriors sit seven points behind Ulster in the PRO12.
Townsend said: "We played some very good rugby last week and scored some excellent tries but I believe there is more to come from this group of players.
"We know we have to perform at those high levels week in and week out when we are competing against sides as good as Ulster.
"We have faced them three times already this season and we're yet to win one, so we're determined to put that right.
"Peter brings another dimension to our play and will lead what is an exciting back division. I'm looking forward to seeing what they can do on Friday night.
"We are now entering the business end of the season, where each match has ramifications on the play-off positions. We will be playing six out of the top seven sides in the next two months and we'll have to be at our best to succeed."
The Warriors have won their last five PRO12 matches and haven't tasted defeat in the league since a 0-6 reverse to Leinster back in November, but the Warriors will again call upon talent from the club game as their front-row continues to be in-demand or out injured.
Ryan Grant, Jon Welsh and Moray Low are all on Scotland duty while Gordon Reid has not been passed fit after suffering concussion at the weekend in the game against Dragons. EDP prop George Hunter is still recovering from a foot injury suffered in December while Mike Cusack is recovering from a shoulder injury.
It means a second start this season for Tongan prop Ofa Fainga'anuku and a return to starting duties for Ed Kalman. The front row is bolstered by the inclusion of Pat MacArthur.
Garry Mountford from Stirling County and Luke Pettie from Gala RFC have joined up with the Warriors to deputise the tight-head and loose-head roles respectively, while the third front row sub is also filled from the club game by Heriot's hooker Fraser Brown.
Tim Swinson and Tom Ryder return as a familiar partnership in the second-row with a back row formed by Josh Strauss, John Barclay and skipper Ryan Wilson.
Niko Matawalu, recipient of three consecutive man-of-the-match awards in the Warriors last three games, starts at scrum half in place of Henry Pyrgos who is on Scotland duty.
Mark Bennett, who touched down for his first Warriors try in the mauling of the Dragons, retains his place alongside Alex Dunbar in midfield with Peter Murchie also keeping his place at full back.
There is a potent threat on the wings with the clubs two top try scorers this season, Tommy Seymour and DTH van der Merwe, lining up on either flank.
Townsend said: "It's not the first time this season that we've faced some challenges around our front-row options but you just have to deal with it and work out the best solution in order to put the team in a winning position.
"I've spoken to Garry and Luke and they are both very much looking forward to being involved. I've been impressed by how well they've scrummaged this season and I'm sure they will grab the opportunity to play at Rabo level.
"It's great news that Ryan, Jon and Moray are all involved with the national team and it means that Ed and Ofa have a chance to stake their claim in our front row.
"It's been a great week for Ed with the birth of his son Joseph, so we'll be hoping he'll be still in great spirits after the game.
"No doubt it's a big challenge as Ulster are very strong in the set-piece and our forward pack understand the test that awaits them. "
"They are a very, very good side all round with an aggressive pack and a potent threat from the half backs right through to number fifteen. Their record this season is something to be admired and the fact that they've only lost one away game the whole of this season is a great achievement.
"We pretty quickly put aside the result from last week and focused on what we have to do at Scotstoun on Friday night to win this game. This is the start of a very tough run of matches and we need to be at our best to maintain the chase for a home play-off."
Glasgow Warriors team to play Ulster in Round 16 of the RaboDirect PRO12, Scotstoun Stadium, Friday 22 February (kick-off, 7.35pm)
15 Peter Murchie
14 Tommy Seymour
13 Mark Bennett
12 Alex Dunbar
11 DTH van der Merwe
10 Peter Horne
9 Niko Matawalu
1 Ofa Fainga'anuku
2 Pat MacArthur
3 Ed Kalman
4 Tim Swinson
5 Tom Ryder
6 Josh Strauss
7 John Barclay
8 Ryan Wilson (Captain)
16 Fraser Brown
17 Luke Pettie
18 Garry Mountford
19 Nick Campbell
20 James Eddie
21 Sean Kennedy
22 Scott Wight
23 Graeme Morrison
Not available for selection through injury.
Mike Cusack (shoulder) Gordon Reid (head) Finlay Gillies (neck) Chris Fusaro (leg) Chris Cusiter (shoulder) James Johnstone (head) Rory Lamont (ankle) George Hunter EDP (foot) Fergus Scott EDP (neck)
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