Who doesn’t love Paneer Butter Masala. This is a rhetorical question, of course because this is such a beloved dish for people all over the country. It is even gaining popularity outside the country now. Paneer Butter Masala is a rich and delicious paneer gravy that can be served as a side for various rice and bread items. This recipe makes the dish in a more restaurant style than a home cooked version.

5 from 2 votes

Paneer Butter Masala

Paneer Butter Masala is a rich and delicious paneer gravy that can be served along with Jeera pulav, plain rice or a variety of Indian breads. This recipe makes the dish in a restaurant style.
Prep Time15 mins
Active Time30 mins
Total Time45 mins
Course: North Indian, Side Dish
Cuisine: North Indian
Keyword: Cottage Cheese, Creamy, Paneer, Restaurant Style, Side dish, Well Liked
Yield: 5
Author: Srimathi and Smrithi


For Tomato-Onion Puree

  • 3-4 Tomatoes Medium sized, diced
  • 1 Onion Finely chopped

For Cashew Paste

  • 1/2 cup Hot water
  • 8-10 Cashew Nuts

For Gravy

  • 2-3 tbsp Butter Salted or Unsalted
  • 1 Bay Leaf
  • 2 tsp Ginger-Garlic Paste Can also be substituted with crushed ginger-garlic.
  • 1 inch Ginger Finely chopped
  • 2-3 Green Chillies Adjust according to preferance
  • 1 tsp Red Chilli Powder
  • 1 1/2 cups Water
  • 3-4 tbsp Fresh Cream Optional
  • 1 tsp Garam Masala
  • Kasuri Methi a pinch
  • Salt to taste


For Cashew Paste

  • Soak 8-10 cashews in hot water for 30 minutes.
  • After the soaking time, grind it to a smooth paste. Add necessary amount of water.

For Tomato Puree

  • Sauté the finely chopped onions in a kadai for 3-4 minutes until the raw smell leaves and the onions turn translucent.
  • Add the tomatoes and sauté till the tomatoes become soft.
  • In the same blender used for the cashew paste, take the sauted onions and tomatoes and grind to a smooth puree.

For the Gravy

  • Dice the paneer and soak them in hot water. This softens the paneer.
  • In a kadai, add 2-3tbsp butter and allow it to melt slightly. Add a bay leaf (tej pattha) and fry for 2-3 seconds until the butter/ghee becomes fragrant.
  • Add ginger-garlic paste (or crushed ginger and garlic) and saute till the raw smell of the paste goes away.
  • Add the tomato-onion puree and stir well. Let this cook for 3-4 minutes. Add red chilli powder and stir well.
  • Stir the mixture well and it will start thickening and coming together. Now, add chopped ginger to this.
  • Add slit green chillies and mix well.
  • Add the cashew paste and stir well.
  • To this, add 1 1/2 cups of water and let it boil. As the water comes to a boil, stir the mixture well and add required amount of salt.
  • The gravy will start to thicken as the water is boiling, at this point, add fresh cream and stir it well into the gravy.
  • Add the soaked paneer cubes and mix it well such that the gravy coats all the pieces.
  • Lastly, add 1tsp garam masala and a pinch of kasuri methi. Stir well for 1-2 minutes.
  • Paneer Butter Masala is now ready to be served.
  • I served this with plain steamed basmati rice.


  1. Addition of Kasuri Methi gives the dish a wonderful smell that makes it feel like something straight out of a restaurant. 
  2. If you don’t have cream, and if your gravy isn’t thickening as much as you’d prefer it to, add a little cornflour+water slurry or maida(all purpose flour)+water slurry. 

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