And the man who last delivered silverware to the Ospreys reckons his former side can clinch a fourth league title - providing they overcome the European giants.
"If the Ospreys beat Munster I think they will win the Pro12 outright," Holley told the South Wales Evening Post.
"They know how to beat Leinster, the key is to avoid playing too much rugby against them, and I would feel confident about the region's chances even if they had to go over the Irish Sea for the final. That said, I wouldn't write off Glasgow against Leinster in the other semi tomorrow.
"But Munster will be a huge test. Even though they have had a great run of late, the Ospreys will know they are facing an outstanding knockout team, cup kings who are massively difficult to beat in a one-off game.
"Munster have the ability to raise their game and produce huge performances when they need them.
"That is what it takes to win a competition like this and the Ospreys have shown they can do it as well.
"They have beaten Munster before in a knockout game at the Liberty and they will take encouragement from defeating them twice already this season. And home advantage matters, particularly if the supporters get behind the players."
History would suggest tonight's clash in Swansea will be a tight and tense affair - the last six encounters between the sides have been won by seven-points or less.
Holley, who left the Ospreys in February, reckons the result could come down to the smallest of margins and highlighted the importance of the regions game-breakers.
All eyes will be on Welsh record try-scorer Shane Williams, who could be making his last appearance at the Liberty Stadium before retiring from professional rugby in the summer.
"It could come down to one moment of magic or one error," added Holley.
"You need your game-breakers to report for duty in a match like this. In the semi-final against Glasgow two years ago, James Hook did wonderfully to set up Shane for an early try, and we didn't look back, even though the game was really tight.
"At this stage all the teams involved are going to be top drawer and margins will be slight.
"There is the possibility that one of the coaching teams will come up with a tactical diamond that gives their team the edge. It could be really tight."