Can 38 special bullets be used in 357 magnum?

Yes you can. The casing of .38 special shells is a mere .10 inch shorter than a .357 magnum shell and will fire easily in a .357 revolver. I've owned a .357 revolver for years and shoot .38 special ammunition in it all the time.

Side note: Don't try it in a .357 semi-auto pistol (like a Desert Eagle.) At best the gun will jam and at worst it might cause an unsafe pressure build up.