Lateral thinking involves solving problems in an indirect and creative way using logic that may not be obvious or traditional. The document provides examples of lateral thinking puzzles, including a surgeon operating on his own son, police arresting the correct suspect without knowing details, and a man only taking an elevator halfway up unless it's raining. It also discusses how brain dominance impacts a person's preferences, problem-solving, and career choices, with right-brain individuals more intuitive and left-brain more analytical.