Lambda expressions are blocks of code that can be used in place of a function. Depending on the type the receiver is expecting they could be either an anonymous method ^{C# 2.0} or an expression tree ^{C# 3.0}.

Code

Now

delegate Image ImageProcessor(Image image);

Image HighContrast(Image image)
{
    Image newImage = (Image) image.Clone();
    imageLibrary.AdjustContrast(newImage);
    return newImage;
}

void Save(IEnumerable<Image> images)
{
    Image processImage = highContrastMode
        ? (ImageProcessor)HighContrast
        : image => image;

    int idx = 1;
    foreach(var image in images)
        processImage(image).Save("Image" + idx++, ImageFormat.Jpeg);
}

Before

delegate Image ImageProcessor(Image image);

Image HighContrast(Image image)
{
    Image newImage = (Image) image.Clone();
    imageLibrary.AdjustContrast(newImage);
    return newImage;
}

void Save(IEnumerable<Image> images)
{
    Image processImage = highContrastMode
        ? (ImageProcessor)HighContrast
        : delegate (Image image) { return image; };

    int idx = 1;
    foreach(var image in images)
        processImage(image).Save("Image" + idx++, ImageFormat.Jpeg);
}

Notes

• The compiler will create a singleton class named <>c and put your anonymous method there
• This has nothing whatsoever to do with Amazon's AWS Lambda service

More information

• C# Language Reference
• C# 5.0 Pocket Reference on Lambda Expressions @ O'Reilly