How to make paneer butter masala

paneer butter masala

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This Paneer Butter Masala recipe is a rich and creamy dish of paneer (Indian cottage cheese) in a tomato, butter and cashew sauce that is known here as “makhani gravy.” The acidity of the tomatoes and the sweetness of the cream make for a velvety, nearly addictive sauce. Also known as “Butter Paneer,” this yummy and popular vegetarian dish is derived from the recipe for Butter Chicken, a.k.a. Chicken Makhani, that I learned to make during my cooking school days. I know, I know, the thought of me cooking with meat sounds insane. It seems nearly a lifetime ago.

paneer tika masala

Ingredients You Need

  • Ripe, red & juicy tomatoes: Tomatoes are a key ingredient here and form the base of the makhani sauce. As such, it is important to choose good, ripe tomatoes that are sweet. If ripe tomatoes are not in season where you live, I suggest opting for using canned whole tomatoes that you blend instead. These canned tomatoes are picked at peak ripeness, and for whatever reason, the whole variety is generally much more flavorful than tomato purée.
  • Raw Cashews: Yet another important ingredient for the gravy is cashews. The nuts impart a lovely creaminess and sheen in the dish, and the sweetness of the cashews help to balance the tanginess of the tomatoes. If you are nut free, please see my recipe for Paneer Makhani, which tastes quite similar but is made with just cream and no cashews.
  • Cream: In addition to using cashew paste, this Butter Paneer recipe calls for cream to help thicken the sauce and add richness. If you are vegan, you can opt to use coconut cream instead, though you should note that the final flavor of the dish will be impacted a bit. You can also opt to omit the cream for a less rich gravy, too.
  • Butter: The amount of butter that is added is just right in this paneer butter masala recipe. Butter makes the curry luxurious and, well… buttery. I don’t add a ton of butter here, so you don’t have to feel too guilty about it. Also note that you can go overboard by adding too much butter, so I recommend that you stick to the recipe.
  • Paneer: The quality of your paneer can make or break your dish. What you want are succulent, soft paneer cubes gently coated with a smooth, buttery tomato sauce. Make sure to use either Homemade Paneer (which I believe is always the best option) or good quality store bought paneer. If you opt to use store bought, be sure to follow the instructions on the package before using.
  • Spices & Herbs: One reason this recipe is so great for weeknights is that the list of herbs and spices isn’t intimidatingly long. For that brilliant orange color, you need to add Kashmiri red chilli powder. If you don’t have any on hand, you can sub it with cayenne pepper or sweet paprika instead. You will also need garam masala powder. Kasuri methi, which are dried fenugreek leaves, also add good flavor. Just skip them if you do not have them. For garnish, fresh cilantro (coriander leaves) are added.

Easy Swaps For a Vegan Version

If you are a vegan, don’t worry! You can easily substitute the dairy ingredients with vegan alternatives and still get a delicious dish. 

  • Tofu: To make a vegan recipe, replace tofu, seitan, tempeh with paneer.
  • Vegan Butter or Oil: Add a neutral-tasting oil or vegan butter, and feel free to skip cream altogether.
  • Coconut Cream: You can also opt to use coconut cream, but please note that the flavors of coconut will be felt in the final dish if you do.

How to Make Paneer Butter Masala

You will have to do some light prep work before you begin making this delicious recipe. It starts with soaking your cashews, making tomato puree and blending soaked cashews.


1. Soak 18 to 20 cashews in ⅓ cup hot water for 20 to 30 minutes.

2. While the cashews are soaking, you can prep the other ingredients. It’s time for chopping tomatoes, chopping and preparing the ginger-garlic paste, and slicing paneer into cubes.

3. To make the ginger garlic paste, crush a 1 inch piece of peeled ginger with 3 to 4 small to medium-sized garlic cloves in a mortar & pestle. Continue crushing until it is a semi-fine or fine paste. Keep aside.

Note: Don’t add any water while crushing ginger & garlic.

4. After 20 to 30 minutes, drain the water and add the soaked cashews to a blender or mixer-grinder. Also, add 2 to 3 tablespoons fresh water (or as much as is required to blend to a fine paste).

5. Blend to a smooth paste without any tiny bits or chunks of cashews. Remove the cashew paste from the blender and set it aside.

6. In the same blender, add 2 cups of diced or roughly chopped tomatoes.

Note: There’s no need to blanch the tomatoes or to wash the blender pitcher before blending.

7. Blend to a smooth tomato puree. Set aside.

Note: Don’t add any water while blending the tomatoes.

Make Tomato Gravy

8. Heat a thick bottomed pan or a heavy pan. Keep the heat to a low or medium-low. Add 2 tablespoons (or 3 to 4 tablespoons for a richer version) butter in a pan. Either salted or unsalted butter can be used.

Tip: Alternatively, you can add 1 tablespoon oil + 1-2 tablespoons of butter to the pan. Adding oil prevents the butter from browning too quickly.

9. Keep the the heat to a low. Add 1 medium-sized tej patta and fry for 2 to 3 seconds, or until fragrant.

10. Add the prepared crushed ginger-garlic or 1 teaspoon ready-made ginger-garlic paste.

11. Sauté until the raw aroma of the ginger-garlic disappears, about 10 to 12 seconds.

12. Pour in the prepared tomato purée.

Note: Be careful while adding the purée as it may splutter.

13. Mix it very well with the butter.

14. Begin to cook the tomato purée on a low to medium-low heat. Stir at intervals.

15. The tomato purée mixture will start simmering.

16. If the tomato purée splutters too much while cooking, then cover the pan partly with a lid or cover fully with a splatter guard (channi lid).

17. Continue stirring occasionally.

18. Simmer the purée for 5 to 6 minutes.

19. Add 1 teaspoon Kashmiri red chili powder or deghi mirch.

You can also opt to add just ½ teaspoon Kashmiri red chili powder, or ¼ – ½ teaspoon of cayenne, paprika or any other variety of red chilli powder that you prefer.

20. Mix well and continue to stir and sauté the tomato purée.

21. Sauté till the butter starts leaving the sides of the pan and the entire tomato purée mixture comes together as more of a thick paste.

Note: This entire cooking/sautéing process takes about 14 to 17 minutes on a low to medium-low heat. Time will vary depending on the thickness of the pan, size, the intensity of flame etc.

Add Cashew Paste

22. Now add the prepared cashew paste.

23. Mix the cashew paste very well with the cooked tomato puree and continue to stir and sauté on a low to medium-low heat.

After adding cashew paste, be sure to continuously stir the gravy.

24. Sauté until the cashew paste is cooked and the oil begins to leave the sides of the masala. The cashew will cook quickly, just around 3 to 4 minutes on a low heat. And don’t forget to keep on stirring non-stop!

25. Next add 1.5 cups water.

Assemble Paneer Butter Masala

26. Mix the water very well with the tomato-cashew masala. If there are lumps, then break them with a spoon or use a wired whisk for mixing.

27. Let the curry simmer and come to a boil on a low to medium-low heat. Stir occasionally.

28. After 2 to 3 mins, add ginger julienne (about 1-inch ginger – cut in thin, matchstick-like strips). Reserve a few for garnishing. The curry will begin to thicken.

29. After 3 to 4 minutes, add 1 or 2 slit green chiles.

30. Also add salt to taste and, if necessary, ¼ to 1 teaspoon sugar depending on the sourness of the tomatoes.

Tip: If you add cream, then you will need to add less sugar. You can also opt to omit sugar entirely if you prefer.

31. Mix very well and simmer for a minute.

32. After the gravy thickens to your desired consistency, then add the paneer cubes (200 or 250 grams).

Tip: Keep in mind the consistency you want before you add paneer, as you will be cooking the paneer for just a few seconds, until it is warmed through. You can also fry the paneer and then add it once the gravy is to your liking.

33. Stir and mix the paneer cubes gently in the gravy. You can switch off the heat at this point.

Tip: If your paneer still tastes raw at this point, leave the heat on low until after you add the cream in step 35.

34. Now quickly add 1 teaspoon crushed dry fenugreek leaves (kasuri methi leaves) and 1 teaspoon garam masala to the gravy.

Note: The addition of crushed dry fenugreek leaves gives a restaurant flavor to this curry, but it is optional and can be skipped.

35. Next add 2 to 3 tablespoons of low-fat or light cream or 1 to 2 tablespoons of heavy whipping cream.

36. Stir gently but well. If you haven’t yet, switch off the heat.

37. Serve Paneer Butter Masala hot garnished with 1 to 2 tablespoons of chopped coriander leaves (cilantro) and the remaining ginger julienne. You can also drizzle some cream or dot with butter while serving. Enjoy!

What to eat with Paneer Butter Masala

  1. Eat with the staple Indian bread roti: Paneer butter masala gravy has a slightly sweet taste and very mildly spiced. Thus making it an excellent gravy to go with roti or chapati.
  2. With other Indian breads: Another great combination for this dish is naan bread or tandoori roti or paratha or roomali roti or Malabar paratha.
  3. With rice: It also goes well with steamed basmati rice or jeera rice (cumin rice).
paneer tika masala 1

Ingredient Notes and Swaps

  • Tomatoes: Since tomatoes are the key ingredient, make sure to use ripe, red and firm tomatoes with a slightly sweet taste. If ripe tomatoes aren’t in season, opt for canned instead.
  • Paneer (Indian cottage cheese): Always use homemade Paneer if possible, or substitute a good quality, store-bought, fresh paneer. Honestly, it is best to make paneer at home and does not take much time.
  • Butter: Use good quality butter. You can use either unsalted or salted, yellow or white butter so long as it is fresh and of good quality.
  • Replacement for cashews: If you don’t have cashews, then the best alternative is almonds. Soak the almonds in hot water for 30 minutes, then peel them and blend to a fine consistency with little water.
  • Color: To get the bright orangish-red color that we associate with makhani gravy, it is best to use Kashmiri red chili powder or deghi mirch as your chili powder. Using deep red colored tomatoes also contributes to a lovely orange color in the gravy. I do not recommend using artificial food colors.

This dish is perfect for a large gathering. It can easily feed a crowd and everyone will love it!

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