Instructions
Reboot your Internet router. This can be done by simply unplugging and plugging it back in. This is especially effective if your game was not lagging before and just started. This step alone is sometimes enough to cure the lag.
Avoid using a wireless connection. Instead, connect your PS3 directly to your router using a network cable. Wireless networks are more prone to network interference and packet loss, which causes lag.
Disconnect other network devices. If you have computers or network devices on the same network, try turning them off or disconnecting them from the network while you play online. You can reconnect them when you are done playing.
Upgrade your Internet connection. The faster Internet connection you have, the less lag you should encounter. Check with your Internet Service Provider to ensure you are using the best Internet package available for gaming that they offer.
Upgrade your hardware. Using top-of-the-line routers and network cables can make a big difference in your Internet connection.