We investigate by electrical transport the field-induced superconducting state (FISC) in the organic conductor $lambda$-(BETS)$_2$FeCl$_4$. Below 4 K, antiferromagnetic-insulator, metallic, and eventually superconducting (FISC) ground states are observed with increasing in-plane magnetic field. The FISC state survives between 18 and 41 T, and can be interpreted in terms of the Jaccarino-Peter effect, where the external magnetic field {em compensates} the exchange field of aligned Fe$^{3+}$ ions. We further argue that the Fe$^{3+}$ moments are essential to stabilize the resulting singlet, two-dimensional superconducting state
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