It's a symbol of Jesus (Lamb of God, the sacrificial lamb etc). I read somewhere that in the 10thC either a whole or pieces of a spit-roasted lamb were included in the basket of food that was blessed on Easter Sunday, but I guess that was out of the reach of most of the population so they substituted a lamb made out of pastry and then sugar.
Nowadays, this Easter lamb turns up on the Polish Easter Table made entirely of either butter or marzipan. Special molds are used to shape these adorable little lambs and can be found in Polish specialty stores online. I'm actually in the process of buying one for my family to use this year.
