Madrid have won in seven of the winger's last eight La Liga starts, with his form enough to consign Gareth Bale to the bench.
And, as a current member of the national team squad bound for the World Cup, Vazquez is happy to fight for a spot at the club he re-joined from Espanyol in 2015.
"I think I'm at the sweetest moment with the most confidence since I came to Madrid, contributing to the team and getting good results," the 26-year-old told Onda Cero .
"My dream has always been to play for Real Madrid. When they proposed [the return] to me it was like seeing a lifetime's work rewarded.
"I am very happy at Real Madrid, it is the team that formed me as a player and I hope I can stay for many years."
Madrid coach Zidane confirmed in February that Vazquez , along with Marco Asensio, was an important member of the squad following his impressive performance in a 3-1 win at Leganes.
"I think they have always been important for me, I'm glad for Lucas because he deserves it," Zidane told a post-match news conference.