AWS Lambda has gained traction for building applications on AWS, but its suitability depends on various factors. EC2 offers a more traditional approach with full control over system-level security, performance, and monitoring. However, it requires manual configuration and forecasting, which can be time-consuming. In contrast, Lambda provides an easier setup and management experience with automated scaling, load balancing, and cost optimization. It is better suited for event-driven applications, infrequently accessed applications, or scheduled jobs. EC2 excels in stateful workloads, high-performance computing, security-sensitive applications, and devOps scenarios. Ultimately, the choice between Lambda and EC2 depends on the specific needs of each project, with Lambda being a good fit for teams who want to focus on writing code without worrying about infrastructure management.