Lexical ambiguity is the presence of two or more possible meanings for a single word. It's also called semantic ambiguity or homonymy.
It differs from syntactic ambiguity, which is the presence of two or
more possible meanings within a sentence or sequence of words.
Lexical ambiguity is the potential for multiple interpretations of
spoken or written language that renders it difficult or impossible to
understand without some additional information. The ambiguity typically
results from the fact that words can mean different things; the
additional information typically supplies context that clarifies which
meaning is intended in this instance.
Lexical ambiguity is what makes puns and other types of wordplay funny,
and unintentional humor can occur when words aren’t considered carefully
enough.
When homonyms can occur in the same position in utterances, the result
is lexical ambiguity, as in, for example, “I was on my way to the bank.”
Of course, the ambiguity is not likely to be sustained in a longer
discourse. A following utterance, for example, is likely to carry
information about depositing or withdrawing money, on the one hand, or,
on the other hand, fishing or boating. Quite often homonyms belong to
different lexical categories and therefore do not give rise to
ambiguity. For instance, seen is a form of the verb see while scene is
an unrelated noun; feet is a plural noun with concrete reference, feat
is a singular noun, rather abstract in nature; and so on.