AWS Lambda is a serverless compute service launched in 2014 that allows organizations to run code in response to specific events without managing the underlying infrastructure, offering significant cost savings and efficiency improvements. It integrates seamlessly with the broader Amazon Web Services (AWS) ecosystem, enabling applications to scale rapidly and connect to various AWS offerings such as data processing, machine learning, and real-time stream processing. Despite its benefits, AWS Lambda presents observability challenges due to its complex microservices architecture, which can make tracking and managing functions difficult. To mitigate these issues, solutions like Dynatrace provide enhanced observability through automation and AI, offering detailed insights into function performance, user experience, and business outcomes. This enables development and DevOps teams to innovate more quickly and effectively, maintaining a balance between leveraging serverless capabilities and ensuring comprehensive monitoring and analysis.