England recovered from last weekend's last-gasp defeat by France to dominate a woeful Scotland side, a 20-0 scoreline failing to reflect their superiority at Murrayfield
The forward pack, led by dynamic number eight Billy Vunipola and Dylan Hartley's accurate performance at hooker, kept Scotland at arm's length and the backline showed intelligence in conditions not suited to running rugby.
"We have put ourselves in contention for the championship," Lancaster said.
"Some of our attacking play was excellent considering the difficult conditions and the only disappointment was that we did not score more points in a second half we dominated having led 13-0 at the interval."
The clash with Ireland at Twickenham in a fortnight will be a far sterner examination, given the way the men in green controlled their match against Wales in Dublin on the way to an emphatic 26-3 win.
"They have an impressive victory over Wales and they are well coached now, blending Munster's mauling game with Leinster's play behind," Lancaster added.
"It is going to be a key match."
Ireland dominated the Welsh in all facets of the game, with halfbacks Jonathan Sexton and Conor Murray particularly impressive, and flanker Peter O'Mahony a menace at the breakdown.
After last year's heartbreaking late loss to New Zealand, Ireland are continuing to progress, and coach Joe Schmidt admitted expectations were starting to increase.
"We needed that performance and that result," he said.
"But there will be a lot of pressure to meet the expectations which will probably be greater now."
France, who face Italy in the final match of the second round on Sunday, traditionally do well the year after a British and Irish Lions tour, although 2013's southern hemisphere efforts may have had a greater impact on Wales, who contributed the bulk of players to the series win over Australia.
After failing to impress against Italy, the Welsh did not front up in Dublin, conceding over a dozen penalties and turning the ball over 10 times.
They will need serious improvement if they want to become the first team to win three championships outright and coach Warren Gatland was forthright in his assessment of his side's efforts.
"It's probably one of the worst performances that we've had since I've been involved," he said.
"We were well beaten up front, weren't we?,"
"We'd spoken all week about discipline and we gave away 17 penalties.
"We worked hard all week on maul-defence and I think they scored 20 points from mauling us."
(Reporting By Josh Reich, editing by Ed Osmond)
