This is best seen when read in the context of verse 14 which precedes it. Here's the text of 1 Peter 3:14-16. Take particular note of the underlined text.
"But even if you should suffer for righteousness' sake, you will be blessed. Have no fear of them, nor be troubled, but in your hearts honor Christ the Lord as holy, always being prepared to make a defense to anyone who asks you for a reason for the hope that is in you; yet do it with gentleness and respect, having a good conscience, so that, when you are slandered, those who revile your good behavior in Christ may be put to shame.
"Verse 14 in fact contains a quotation (the underlined text) from Isaiah 8:12, in which we read, "Do not call conspiracy all that this people call conspiracy, and do not fear what they fear, nor be in dread." Verse 15 of 1 Peter 3 continues the quotation into verse 13 of Isaiah 8, but with a subtle change.
Isaiah 8:13 reads, "But the Lord of hosts, him you shall honor as holy." Compare this to the start of 1 Peter 3:15: "...but in your hearts honor Christ the Lord as holy." Peter has replaced "the Lord of hosts" from Isaiah 8:13 with "Christ the Lord", asserting that it is "He" whom we are to regard as Holy.
In so doing, the Apostle Peter has here effectively identified Jesus as being of the same essence as Yahweh, another Biblical proof of the deity of Christ.
Source: http://candle-magic.blogspot.com
