Cold starts in AWS Lambda can significantly impact performance, especially for real-time applications. Cold starts occur when a new container is spun up to run the function, which can take longer than expected due to initialization times. The size of the deployment artifact and dependencies can affect cold start duration, with larger artifacts leading to longer latencies. Using Ahead-Of-Time (AOT) compilation can reduce cold start times by compiling code into native binaries before deployment. Keeping Lambda functions warm by periodically invoking them can also help prevent cold starts. Additionally, reducing the number of packages used in the application and using languages like Node.js, Python, or Golang can optimize cold start durations. Monitoring applications to identify how cold starts are affecting performance is crucial to address these issues. Tools like Lumigo can help developers find, fix, and prevent cold starts, providing a serverless monitoring platform with features such as visual debugging, distributed tracing, and smart alerts. By applying these strategies, developers can minimize the impact of cold starts on their applications' performance and latency.