Panesar took three wickets as England skittled Warwickshire for 102 yesterday in their warm-up match for next week's first Test in Cardiff.
The Northants slow left-armer had taken just six first-class wickets this season in six games, and has fall
en down the England spin pecking order behind former team-mate Graeme Swann and Yorkshire leg-spinner Adil Rashid.
But Lamb believes if Panesar can quickly rebuild his confidence he could still win his place in the side and be a force as England look sure to go with two spinners in Cardiff.
"Hopefully Monty can rediscover his form this week for England against Warwickshire," said Lamb.
"England have to go with the men in form and hopefully that will be Monty after this week. Rashid looks a good bowler, though as a young leg-spinner the Aussies will go after him. But whoever is in form, England have to go with them, and if Monty gets his confidence back then he can still take wickets at that level, he has shown that in the past."
Panesar has not played any international cricket for four months, last appearing against the West Indies in Trinidad and he has hardly started this season in a blaze of glory.
But his Test record ranks alongside any of England's post-war spinners, with only Derek Underwood bettering his 33.72 for 125 wickets from 38 games, and Rashid this week went for 72 in 14 wicketless overs for the Lions against Australia.
Panesar's faltering form in recent months has coincided with continuing calls for the 27-year-old to bowl with more variety.
Aussie legend Shane Warne has been the most vociferous saying Panesar hasn't played 38 Tests, but the same Test 38 times, and Lamb feels the criticism has affected Panesar.
"There have been too many people trying to coach him," says Lamb.
"I was in India and I saw Monty bowling before the game, then being taken out at lunch and bowling and then bowling after the day's play.
"It is too much for the guy.
"There has been too much coaching of him. He just needs to get back to what was getting him wickets in Test cricket.
"There are too many things going on in his head and it has affected his confidence.
"People said he was bowling too quickly in India and he probably was, but that has brought him success, especially in England, and he should get back to that. He just needs to rebuild his confidence."
