"For, 'Whoever would love life and see good days must keep his tongue from evil and his lips from deceitful speech. He must turn from evil and do good; he must seek peace and pursue it. For the eyes of the Lord are on the righteous and his ears are attentive to their prayer, but the face of the Lord is against those who do evil.'" NIV translation
Peter is quoting from Psalm 34 here and it is a good reminder to us that Jesus is watching us at all times. Jesus bought us with His blood and He watches and listens to us. We cannot be double minded where we consistently do evil and then, when its time to go to worship, we switch to being Christians. We are new creations in Jesus and that new creation doesn't go back to the old ways. The turning that is described in the Psalm is repentance where we agree with God that these things are wrong and through His power we will not do them anymore.
"Who is going to harm you if you are eager to do good? But even if you should suffer for what is right, you are blessed. 'Do not fear what they fear, do not be frightened.'" NIV translation
Although it may not make sense to us that people would want to harm us for doing good, it will happen. The answer to Peter's question of "Who" is those that reject the Word of God but Peter also gives encouragement by saying that, even if that happens, we are blessed. The quote about fear comes from Isaiah chapter eight and is basically reminding us not to fear any man and what they can do to us. Any fear (other than the Biblical fear of God) is of the devil and therefore is nothing that should be a part of our lives.
"But in your hearts set apart Christ as Lord. Always be prepared to give an answer to everyone who asks you to give the reason for the hope that you have. But do this with gentleness and respect, keeping a clear conscience, so that those who speak maliciously against your good behavior in Christ may be ashamed of their slander." NIV translation
First of all, Jesus must be Lord of your heart and that is a decision we make at salvation. Then, when people see us living out our time here on earth with joy, we are to be prepared to tell them how/why we can do so. We are to do this in a loving way as we accept people where they are and trust God to use us as He knows is best. By demonstrating this love, those who say bad things about you and your walk with Christ will be convicted by their own words. Once God brings conviction to them, it is possible for them to repent and turn to Christ as that is our goal in everything.