Location in injection system
On newer engines the lambda sensors are located in the exhaust system upstream and downstream of the catalytic converter.
One side of the sensor element electrode is exposed to the exhaust gas, whereas the other is in contact with the ambient air. The ambient air is used as reference air for measurement of the residual oxygen.

Mode of operation
The electronic control unit detects the mixture composition (lean or rich) from the lambda sensor voltage. It adjusts the injected fuel quantity such that an optimum mixture composition (λ = 1) is guaranteed, thus creating ideal conditions for exhaust gas treatment in the catalytic converter. Allowance is made for the engine load in this process.
The quantity of fuel must be reduced if the mixture is too rich (λ < 1) and increased if it is too lean (λ > 1). If fitted, a second Lambda sensor, the diagnostic sensor (downstream of the catalytic converter) detects whether the control sensor (upstream of the catalytic converter) is still functioning optimally. The electronic control unit can then calculate the amount of compensation required to rectify any deviation.