Lam spoke at a reception that followed a morning flag raising ceremony marking the 71st anniversary of the founding of the People's Republic of China.
The ceremony in Hong Kong's Golden Bauhinia Square came as anti-government protests have dwindled due to coronavirus restrictions on group gatherings and fears over a sweeping national security law imposed by Beijing on June 30.
The law punishes what authorities see as subversion, secession, foreign interference and terrorism with up to life imprisonment. Critics of the law say it erodes any remaining freedoms the former British colony has, while supporters say it will bring stability after last year's anti-government protests.
Lam told the attending guests the law had been effective in bringing back stability to the city, saying: "Once again the people can enjoy their basic rights and freedom in society in accordance to the law."