There arent any fixed rules on when to use horizontal partitioning, but its generally suitable for large tables, particularly if you have a sliding window scenario with historical data in the same table as current data.
A good rough startting point is tables having more than a million rows. The following article by Kimberly Tripp (one of my favorite people in the world) may help you decide.
http://msdn.microsoft.com/library/default.asp?url=/library/en-us/dnsql90/html/sql2k5partition.asp
I feel the need - the need for speed
CK Bhatia