The French side dropped just two points in their six group games, as they helped eliminate last season's runners-up Athletic Bilbao.
And, despite Remi Garde's men having won just three of their last eight games domestically, Villas-Boas remains wary of their quality.
"It's a big game and there is big motivation," he told Tottenham's official website.
"They have lots of young players coming through, particularly Gonalons and Lovren. They also have experienced players like Malbranque, who can give them the extra edge.
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"They sit second in the [Ligue 1] table at the moment but have massively improved since last year."
The 35-year-old went on to claim that getting beyond an experienced side such as Lyon could serve as inspiration to Spurs for the rest of the campaign.
"It's a difficult tie against a team that is very, very experienced and have many trophies in the bag. They also have a lot of experience in the Champions League," the Portuguese added.
"Our players are motivated to do well in this competition and they know that if they beat Lyon, it will serve as further inspiration for the rest of the tournament."