The Reds qualified for the final after a nervy finish to Wednesday's second-leg tie against AS Roma, which saw them lose 4-2 on the night, but qualify via the odd goal on aggregate.
Real Madrid have won the competition two years running and three times in the last four seasons, an accomplishment that surely makes the Reds slight underdogs heading into the May 26 final in Kiev.
However, Lovren is confident that Liverpool have nothing to fear against the current holders, even if the Reds did gift Roma a couple of late goals in their 7-6 aggregate triumph.
"They are quite confident. But we don't care for that, we are focused on our job," he told reporters.
"Why should we fear them? They should fear us. The best teams [in the competition] are us and Real Madrid. Let's see what will happen.
"It is unbelievable [that we have got there], something that every player dreams of doing; it is just an honour to play for Liverpool and lets do something in the final now. It is an honour to play with this team, they are fantastic these players, these fans.
"It was difficult in the last 10-15 minutes, our heads I would say were in the final already, that is why we conceded but let's enjoy now."
The Reds face Chelsea and Brighton in the Premier League ahead of that date in three weeks' time, with a win in any three of those matches likely meaning qualification for the Champions League next season.