Disclaimer: Creating a bootable USB without using the downloaded ISO but the pre-installed Ubuntu is a little complicated for new users. If you want that, see the answer below. This answer gives two simpler alternatives.

Make a standard bootable Ubuntu USB from within pre-installed Ubuntu (simple)

Frist, check the installed version of Ubuntu by opeining a terminal (press Ctrl+Alt+T) and type lsb_release -a.

Note down the version number and OS Type (32bit or 64bit).

Second, download the ISO from http://www.ubuntu.com/download/desktop, by selecting the appropriate version.

Third, insert an USB drive (4GB or greater for Ubuntu, 2GB or greater for Lubuntu, Xubuntu).

The Startup Disk Creater takes two inputs, the location of the ISO file and the location of the USB drive.

Fourth, point the Startup Disk Creater to the ISO and the USB drive.

See the help on Create a usb stick on ubuntu for a simple set of instructions.

Also see a more detailed instructions on USB stick creation

Remastersys does not exist anymore.

The next section is obsolete.

Make a custom bootable backup Ubuntu USB from pre-installed Ubuntu (Complicated)

First, Add Remastersys source information to Software Center. Open Software Center and click on “Edit” and select “Software Sources.”

Select the “Other Software” tab at the top and you need to click the “Add” button, and copy and paste this:

deb http://www.remastersys.com/ubuntu precise main

And then click “+Add Source”, then click "Close" and completely close out of Software Center.

Add the PGP key for the Remastersys repository, in Terminal (press Ctrl+Alt+T) copy the two lines below one line at a time and paste (press Ctrl+Shift+V) in Terminal:

wget -O - http://www.remastersys.com/ubuntu/remastersys.gpg.key | sudo apt-key add -
sudo apt-get update

Second, install Remastersys. Open Software Center and search for and install remastersys.

Third, run Remastersys. Click on "Backup" and wait a long time till it finishes creating the ISO file.

Fourth, create startup USB following instructions above.

More detailed information and some qualifications on how to do this is here. Hope this helps.

Use the Startup Disk creator. Install via Software Center or:

sudo apt-get install usb-creator-gtk