But the Scot is determined to meet the challenge rather than throw in the towel in the battle for Barclays Premier League survival.
Lambert has taken great encouragement from Villa's performances in recent weeks even if they have not been backed up by positive results.
The 2-1 defeat at Arsenal last weekend saw Villa slide back into the bottom three for the fourth time this season.
But Lambert is thriving on the task of reviving Villa and trying to win a third successful fight against the drop out of the top flight ahead of Monday's home game with Manchester City.
He said: "I knew it was going to be tough. Randy (Lerner) told me that from day one.
"But it's a brilliant challenge for us to go and rectify it.
"I knew the parameters. It's a great challenge, a great club, great fanbase.
"You either deal with it and meet it head on or you roll over and die with it. I always meet things head on.
"I relish the challenge of the games ahead. It's a great honour to be the manager of this club. It's a massive club with a great history."
Lambert insists talks are continuing with 10-goal striker Andreas Weimann over a new contract.
Weimann has 17 months left of his remaining deal - worth around £15,000 a week - and there has been speculation that negotiations have stalled over the terms of a four-year offer.
Lambert wants to keep hold of the Austria Under-21 international, and believes Weimann is happy at the club.
He said: "Have contract talks stalled? No, we are still talking. Contrary to reports, I spoke to Andi the other day about it and he has never once indicated what the report said.
"I think everyone knows agents can inflate people's salaries to whatever it is going to be.
"I've spoken to Andi and everything is fine. Talks are ongoing but that's normal when you are trying to negotiate.
"Andi loves it here. I've spoken to him. I think there are more important things at this moment in time than worrying about contracts.
"What will happen with his contract will happen. He's still under contract so at the minute it's fine. I don't think he'll walk away. I don't."
Lambert does admit that players moving on is part of football if they receive better offers elsewhere ahead of James Milner and Gareth Barry's return to Villa with City.
He said: "If somebody gets more money somewhere else, then people are going to look at it.
"You would probably do it. If someone offered you'd more money you would think, 'Yes, that looks quite good'.
"But I think if you would ask Gareth Barry and James Milner whether they enjoyed their time here, I am pretty sure, without knowing the lads, that they loved it.
"People come and go. That's football."