The 33-year-old believes the Germany international has the personality and intelligence to make a success of his new role
The 29-year-old made his name as a full-back but has flourished in a central role since filling in for the injured Javi Martinez at the Allianz Arena, and Xavi believes it has made him an even more formidable opponent.
"Lahm is a top player with a lot of personality, who can play anywhere on the pitch," the Spain midfielder told Sport Bild.
"He seems to be getting even better. He has what it takes to be a top midfield player."
Bayern coach Pep Guardiola added a glowing endorsement of Lahm's transition and firmly believes the Germany international is the right man at the base of his midfield.
"The way Lahm has been playing in recent games, I think it is impossible that anybody could have played any better there," he said.
"In the 1-1 draw with Leverkusen last weekend he completely dominated the midfield. He had 115 touches."
Finally, Lahm himself admitted he is relishing his new role, having played the large majority of his career in defence.
"I love it in the middle, it is a lot of fun."