Python’s `lambda` functions can be used effectively in scenarios where a small, unnamed function is needed for a short period of time. They are particularly useful when a function is required for a single expression and can be used as an argument to higher-order functions like `filter()`, `map()`, and `reduce()`.

They are preferred over regular function definitions when brevity and conciseness are valued, such as when defining simple operations or functionality within a limited scope. However, it’s important to note that `lambda` functions are limited to a single expression, which makes them unsuitable for more complex logic or larger tasks.

In summary, `lambda` functions are effective for short, one-off functions that are used as arguments to higher-order functions, and they are preferred over regular function definitions in situations where brevity and simplicity are prioritized.