AWS Lambda can be very cost-efficient compared to traditional hosting, especially for workloads with low, bursty, or unpredictable traffic, because you only pay for actual requests and execution time instead of keeping servers running 24/7. This makes it an excellent choice for APIs, background jobs, automation tasks, and event-driven applications where usage is not constant. However, for high-volume or continuously running workloads, costs can sometimes rise and become less economical than containers or dedicated servers. To control serverless costs, teams should optimize function execution time, allocate only the required memory, reduce unnecessary invocations, use efficient code and caching, and monitor usage regularly through cost dashboards and alerts. It also helps to design event flows carefully so functions are triggered only when needed. Overall, Lambda is highly efficient when used for the right workloads, but active cost monitoring and optimization are important as usage scales.