The firm posted a 2.6 per cent year-on-year rise in UK sales over the four weeks to Boxing Day - an increase of 21 per cent when compared with pre-pandemic levels two years earlier.
Lidl said its Christmas jumper was the fastest-selling item in its so-called Middle of Lidl aisle, with one sold every two seconds or so on its first day of sale.
The group saw the highest ever number of shoppers visiting its UK stores in the week leading up to Christmas, with footfall up 14 per cent on its busiest day on December 23.
It claimed to notch up £21 million of spending from customers switching away from other grocers during December.
Christian Hartnagel, chief executive of Lidl in the UK, said: “Despite ongoing challenges with the pandemic, customers continued to find ways to celebrate this Christmas.
“As inflation continues to rise, I want to reassure each and every one of our customers that we remain resolute in our promise of being the destination for the lowest grocery prices in the market.”
Lidl said lamb proved a popular alternative to the traditional turkey for Christmas lunch, with sales up 21 per cent year-on-year, while the classic Christmas pudding enjoyed a 23 per cent jump in sales.
It said customers were “clearly feeling generous” over the period as families were able to get together this time round, with more than eight million Christmas cards and a million rolls of wrapping paper sold.
Lidl - which is part of the German retail group Schwartz - has more than 890 stores in the UK after opening eight new sites, with plans for more shops to launch in January.
The figures came just a day after rival Aldi’s festive trading update, revealing a 0.4 per cent year-on-year rise in sales in December.
Market majors Sainsbury’s and Tesco are poised to report their Christmas trading figures.
Aldi claimed that figures from research firm Kantar showed that it was the “only major supermarket” to increase its sales for December.
Giles Hurley, UK chief executive of the German-owned chain, welcomed the performance and said the retailer was boosted by strong sales of its premium product lines. He also said the group will commit to offering shoppers the lowest grocery prices throughout 2022.
During the festive period, Aldi sold more than 43 million mince pies and 118 million Brussels sprouts.
The retailer, which has some 950 stores across the UK, is set to continue its rapid expansion over the new year, with plans to open more than 100 sites, including several in Scotland.
Susannah Streeter, senior investment and markets analyst at financial services group Hargreaves Lansdown, said: “The Christmas shopping season is akin to the world cup for retailers and Aldi UK is on a winning streak, not just notching up record sales but attracting half a million new customers.”