LAMBDA achieves effectively noise-free performance and photon energy discrimination by using photon counting. To do this, each pixel on the sensor layer is connected to a signal processing channel on the Medipix3 chip using the hybrid pixel technology. Whenever a hit occurs on a pixel, a current pulse is produced whose total charge is proportional to the photon energy. This charge is compared to a user-defined energy threshold. If it exceeds the threshold, the hit is accepted and a counter in the pixel is incremented.In addition to standard photon counting, the LAMBDA system can also perform energy binning. Each photon hit can be compared to multiple energy thresholds, with multiple counters being used to store the number of hits in each energy bin. An additional feature of the Medipix3 chip, “charge summing”, ensures that the photon energy can be accurately measured even if the signal is spread between neighbouring pixels. A typical application with an X-ray tube would be to distinguish elements by their absorption edges, for instance to better distinguish contrast agents used in medical imaging like iodine. At synchrotrons, it would be possible to distinguish photon hits produced by higher harmonics, or it could be applied to pink and white beam experiments - for example to distinguish overlapping diffraction spots at different energies in Laue diffraction.