O'Driscoll missed the 20-17 defeat by France with the hamstring strain he sustained in the championship opener against Wales but has made a full recovery.
The Leinster centre takes over the captaincy from Paul O'Connell with Shane Horgan switching to the right wing and Geordan Murphy dropping out of the squad.
Peter Stringer is still struggling with the fractured hand that forced him to miss the Croke Park debut so Ireland have left the scrum-half berth open.
Stringer will be given until later in the week to prove his fitness with Isaac Boss ready to deputise once again should the Munster veteran fail to make it.
Ronan O'Gara suffered an ankle injury against France and missed training last week but has also been included in the team to face England.
Powerful Ulster back Andrew Trimble is preferred to Murphy on the bench.
Ireland head coach Eddie O'Sullivan is pleased by the speed of Stringer's rehabilitation and will make a final decision on his selection in the next two days.
"The situation with Peter is encouraging at the moment," he said.
"His progress slowed down this week but he had a workout yesterday and there has been no adverse reaction to it so far.
"We'll give it another 48 hours and then take another look at the situation."
O'Sullivan claimed Murphy had paid the price for his indifferent form with Trimble edging a narrow call on the bench.
"The exclusion of Geordan will be an issue for some but with Brian back and Shane on the wing it was a scramble for the utility position on bench," he said.
"It was a tough call but that's where we were. Geordan is not firing on all cylinders at the moment and Andrew has come back stronger."
Ireland: Girvan Dempsey (Leinster), 14 Shane Horgan (Leinster), 13 Brian O'Driscoll (Leinster, captain), 12 Gordon D'Arcy (Leinster), 11 Denis Hickie (Leinster), 10 Ronan O'Gara (Munster), 9 Peter Stringer (Munster)/ Isaac Boss (Ulster), 8 Denis Leamy (Munster), 7 David Wallace (Munster), 6 Simon Easterby (Llanelli Scarlets), 5 Paul O'Connell (Munster), 4 Donncha O'Callaghan (Munster), 3 John Hayes (Munster), 2 Rory Best (Ulster), 1 Marcus Horan (Munster).
Replacements: 16 Jerry Flannery (Munster), 17 Simon Best (Ulster), 18 Neil Best (Ulster), 19 Mick O'Driscoll (Munster), 20 Isaac Boss (Ulster)/ Eoin Reddan (Wasps), 21 Paddy Wallace (Ulster), 22 Andrew Trimble (Ulster).
Date: Saturday, February 24
Venue: Croke Park, Dublin
Kick-off: 17:30 GMT
Referee: Joël Jutge (France)
Touch judges: Nigel Whitehouse (Wales), Christophe Berdos (France)
Television match official: Romain Poite (France)
Assessor: Steve Hilditch (Ireland)