Following the Magners League clash, Townsend will hang up his boots after an illustrious 12-year career in professional rugby having signed his first contract with Northampton in 1995.
Borders head coach Steve Bates said: "Saturday will be a very notable occasion as it marks the end of Gregor Townsend's fantastic rugby career that has included 82 caps for his country and has established him as one of Scotland's greatest ever natural talents.
"Since the announcement of the closure we have had to play the top five teams in the league and although we have not accrued many points, I have been extremely proud of the team and the way the players have applied themselves in difficult and uncertain circumstances."
In addition to Townsend's return to the starting line-up, two further players are drafted into the team which started against Leinster last weekend.
Nick de Luca returns to the centre alongside Ben MacDougall with Calum MacRae moving to the left wing.
International hookers Ross Ford and Steve Scott switch places from last weekend to give Ford the starting berth for the farewell fixture.