Minecraft wiki entry for Time-saving_tips, associated text: A lava bucket is excellent for killing large numbers of mobs in one go and lighting up the area at the same time. This can be a significant time-saver when dealing with a new mob spawner. Once most of the mobs have been killed, finishing off the last few manually and neutralizing the spawner is much quicker and safer than trying to wade through large numbers of enemies. This trick works particularly well when combined with a potion of Fire Resistance, as you can wade through your own lava and move right up to the spawner, even with troublesome blaze spawners in the Nether.
You can also use a bucket of lava as a fuel for your furnace. This is good if you have large numbers of things that need to be smelted, as Lava smelts 100 items/blocks.
Similar to flint and steel, lava buckets can be used to speed cook live animals, but better. The benefits are threefold: lava can be placed directly under mobs, slows them down and deals heavy damage. The disadvantage is that the meat drops might fall into the lava, destroying them, however this can be offset with a bit of practice. This method works best on pigs and cows, as they have higher health pools and their meat is the most nutritious. Simply place a lava block so it touches the animal, wait a few moments, scoop the lava back into your bucket and collect your meat. Pigs and cows die in 3 lava damage ticks, sheep in 2 and chickens die instantly. Some caveats: be careful around grass, because lava is pushed away from it when placed on it, potentially on you. Also when lava grilling cows, be sure not to accidentally milk them with your empty bucket.