The lateral diffusion of lipids within a membrane is of paramount importance, serving as a central mechanism in numerous physiological processes including cell signaling, membrane trafficking, protein activity regulation, and energy transduction pathways. This review offers a comprehensive overview of lateral lipid diffusion in model biomembrane systems explored through the lens of neutron scattering techniques. We examine diverse models of lateral diffusion and explore the various factors influencing this fundamental process in membrane dynamics. Additionally, we offer a thorough summary of how different membrane-active compounds, including drugs, antioxidants, stimulants, and membrane proteins, affect lipid lateral diffusion. Our analysis unveils the intricate interplay between these additives and membranes, shedding light on their dynamic interactions. We elucidate that this interaction is governed by a complex combination of multiple factors including the physical state and charge of the membrane, the concentration of additives, the molecular architecture of the compounds, and their spatial distribution within the membrane. In conclusion, we briefly discuss the future directions and areas requiring further investigation in the realm of lateral lipid diffusion, highlighting the need to study more realistic membrane systems.