England international Walcott made a competitive appearance for the first time since sustaining a cruciate knee ligament injury in January, when he came on as an 80th-minute substitute in Saturday's 3-0 Premier League win over Burnley.
The 25-year-old winger was given a superb ovation by the Emirates Stadium faithful and showed signs of his quality during his brief cameo.
Manager Wenger is happy to have more competition in attacking positions and is eagerly awaiting further selection headaches with the likes of Olivier Giroud, Mesut Ozil and Jack Wilshere all to come back from injury.
"Of course [it is a lift to have Walcott back]," Wenger said. "For him it must be great as well to see that everybody wants him to come on.
"Lukas Podolski also could have scored two and he came on. When you think that we have not got a number of offensive players like Ozil, Wilshere and Giroud [to come back], there's a lot of competition in the forward positions."
On Walcott's performance, he added: "It's good I could give him 12 or 13 minutes today when the game was nearly won.
"It's good that his decision making and movement are good - he just needs to get used to competition."
