Paneer Butter Masala : Ultimate Recipe Guide For 2021

Paneer butter masala more than a dish is a feeling for me. The mere thought about it brings me joyous memories of visiting the Punjabi Dhaba with friends during my college days.

I fell in love with the Dhaba style paneer butter masala the moment the first bite of roti dunked in the flavourful gravy made magic in my mouth, for the first time in my life.

As a student, I never thought I would ever treat myself to self-cooked Dhaba-style paneer butter masala. I would visit the Dhaba with my friends every time I craved the delicious paneer butter masala they served.

Today I am proud to share with you all that I made this dish last week and it turned out so good that tears welled up in my eyes remembering my good old student life.

Never did I realize that this favorite dish of mine was so easy to prepare and is one of the simple paneer recipes until I tried it. And here I am sharing this butter paneer recipe with you all so that you could try it too and feel the magic of cottage cheese.

Paneer Butter Masala

Paneer Butter Masala Dhaba Style | How To Make Paneer Butter Masala

Samiksha Sanket
This is a complete guide for making paneer butter masala. Find out how to make this awesome dish in the most convenient way possible.
Prep Time 20 mins
Cook Time 40 mins
Total Time 1 hr
Course Main Course
Cuisine Indian
Servings 4 People


  • 250 gm Paneer Cubes
  • 2 tbsp Ghee (clarified butter)
  • 8 tbsp Butter
  • 3 piece Green Cardamom (ilachi)
  • 4 piece Cloves (laung)
  • 1 piece Bay Leaf (tej patta)
  • 2 piece Dry Kashmiri Red Chillies (degi mirch)
  • 1 inch Ginger (Adrak) (peeled and roughly chopped)
  • 4 piece Cloves (Lehsun) (peeled and roughly chopped)
  • 2 piece Green Chilli (chopped hari mirch)
  • 2 piece Onions (sliced)
  • 1/3 cup Whole Cashews
  • 6 piece Tomatoes (chopped)
  • 1/3 cup Yogurt (dahi)
  • 1/4 tsp Turmeric Powder (haldi)
  • 3 tsp Kashmiri Red Chilli Powder (lal mirch)
  • 1 tsp Cumin Powder (jeera powder)
  • 2 tsp Coriander Powder (dhaniya powder)
  • 2 drops Kewda Water (diluted)
  • 1 piece Onion (finely chopped)
  • 1 piece Tomato (finely chopped)
  • 2 tbsp Honey / Sugar
  • 1 tbsp Fenugreek Leaves (dried kasoori methi)
  • Salt as per taste
  • Water as required
  • 1 tbsp Coriander Leaves
  • 1 tbsp Fresh Cream / Yogurt


Preparation For Paneer Butter Masala Recipe

  • Warm some water, once the water is warm enough add some salt, turn off the gas. Now soak paneer cubes in warm salted water and keep them aside until we add them to the gravy. Soaking paneer in warm salted water makes paneer soft, juicy, and fresh. 
  • In a bowl take 1/3 a cup curd, add 1 ½ tsp degi red chili powder, 1 ½ tsp coriander powder, ¼ tsp turmeric powder, a teaspoon butter; now mix everything well to create a curd mixture and rest it aside.

Method For Cooking Paneer Butter Masala

  • In a deep Kadai, heat ghee or butter on a medium flame.
  • Once heated, add bay leaf, cloves, green cardamom, ginger, garlic, and green chilies.
  • Add onions and saute until it becomes translucent and rawness has gone.
  • Add curd mixture which we have prepared earlier, dry Kashmiri red chili, and continue cooking until it becomes fragrant or for at least 2-3 minutes while mixing it continuously.
  • Add the cashews, dry degi red chilies, Kashmiri/ degi red chili powder, and salt as per your taste and saute it for 2 -3 minutes.
  • Add tomatoes and cook it for 2 -3 minutes while mixing everything occasionally.
  • Add 1 ½ cup of water, stir everything well, cover the Kadai with a lid and cook the mixture for another 8-12 minutes until the tomatoes are soft, mushy and rawness has gone.
  • Stir it at a regular interval. Once the masala is ready, turn off the flame.
  • As masala cools down, you may want to remove the whole spices as they can change the color of gravy; grind masala into a mixer or hand blender to make a very fine puree; use some water for grinding.
  • It is very important to grind masala as fine as you can to get the thickness and richness of cashew for the gravy.
  • Strain gravy – puree through a sieve to smoothen it out; we are going to discard any thick leftover ingredients from the sieve.
  • Rest sieved gravy – puree aside.
  • For tempering, heat some butter in Kadai, add finely chopped onions, saute it until the onion turns translucent and rawness has gone.
  • Add degi / Kashmiri red chili powder, coriander powder, cumin powder while stirring it continuously.
  • Add finely chopped tomato, cook them completely.
  • Add gravy – puree which we have made earlier, mix everything very well, and cook it for 10-12 minutes.
  • To adjust thickness add around a cup of water, if required, and stir in between. Adjust salt, spice level as per your taste.
  • Add 2 drops of kewra water, some honey or sugar, cook everything well for another 2 to 3 minutes; while stirring it occasionally.
  • Add kasoori methi, some butter, and paneer cubes into the gravy; cook it for another 2 -3 minutes on low flame, and now switch the flame off.
  • Paneer butter masala is ready for servicing, garnish it with some fresh cilantro leaves and with some fresh cream or yogurt.
Keyword Paneer Butter Masala, Paneer Butter Masala Dhaba Style

Can You Make Paneer Butter Masala In An Instant Pot?

Instant pot is an electric pressure cooker that quickens the cooking process by controlling the pressure within the device.

It functions like a traditional pressure cooker, even though instant pot differs in usability, is much safer, and causes less mess.

If you cook most of your meals in an instant pot, you have good news; with the help of an instant pot paneer butter masala recipe, you can cook your masala paneer in an instant pot too.

What Is Paneer?

Raw Paneer Cubes

Also known as poneer and fonir, paneer is a cottage cheese believed to have originated in the Indian sub-continent. It is made using buffalo milk or cow milk with the help of acid derived from fruits or vegetables.

The commonly used acid to make paneer is lemon juice. The process involved results in soft, unripened cheese, that is used to make multiple dishes, the popular being paneer butter masala.

History Of Paneer

I love delving deep into the history of the foods we eat. In the case of paneer butter masala, I was intrigued about how paneer became a central part of Indian vegetarian cuisine. I would like to share with my readers, what I have learned from my research.

The origin of paneer revolves around many theories. Some believe it to have been present in the Vedic scriptures while some conclude that it originated in Persia and was made popular in Indian land during the Muslim rule.

Some theories suggest paneer was originated in Afghanistan. Yet another theory opines that the Portuguese’s technique of breaking milk with acid, which was introduced in Bengal in the 17th century may be the start of paneer in India.

The theories do not end here. Delving into the history of paneer would also give us great insight into the history of India.

Difference Between Paneer And Cheese

At a glance, paneer and cheese may look the same. But in fact, they have different texture, taste and is made using different methods. Acidification is the process involved in making cheese and paneer is made by curdling heated milk with lemon juice.

There are numerous varieties of cheese and can be found in different flavors. While paneer has a short shelf life, the shelf life of cheese is longer, all thanks to the emulsification process involved in the production of cheese.

Paneer has a lower concentration of fats and calories when compared to cheese. However, the protein and calcium content in cheese is higher than what is found in paneer.

While paneer butter masala recipe is one of the popular paneer recipes, cheese is used in various dishes- pizza, pasta, and fondue to name a few.

Can You Replace Paneer With Cheese In The Paneer Butter Masala Recipe?

Even though paneer and cheese look merrily the same, they have different flavors and uses. Hence, paneer cannot be replaced with cheese in the paneer butter masala recipe.

Moreover, paneer butter masala is an Indian recipe and cheese is not a commonly used ingredient in authentic Indian dishes.

Any Alternative For Paneer In Paneer Butter Masala Recipe?

Whether it is the restaurant-style paneer butter masala recipe or the Dhaba-style paneer butter masala recipe, paneer is the central ingredient, and simply cannot be replaced with anything else, except for Queso Blanco.

What Is Queso Blanco?

Image of Queso Blanco
Image of Queso Blanco

Paneer could be easily mistaken for Queso Blanco, due to its high similarity in texture and process of making. Both are soft, unaged forms of cheese made using acidification.

Queso Blanco is a Mexican cottage cheese that is also popular in the Americas and Spain. While lemon is commonly used for acidification in paneer, white vinegar is used to make Queso Blanco.

And if you cannot get your hands on paneer Queso Blanco is easily available, you could very well replace the former with the latter while making restaurant-style paneer butter masala.

Is Paneer Butter Masala A Vegetarian Recipe?

Paneer butter masala is a pure Indian vegetarian recipe. The dish is also high in protein, vitamin A, calcium, and iron. However, vegans who do not consume dairy products may not find paneer recipes suitable for their diet.

Spices Used In Paneer Butter Masala

Paneer butter masala recipe would be incomplete without the spices that give it the distinct flavor. The commonly used whole spices during the preparation of paneer butter masala are cardamom, cloves, bay leaf, cinnamon, cumin seeds, and fennel seeds.

However, if you do not have any of these, you can manage with the ones you have. It is important to not use these spices more than the recommended measurements, as overdoing spices can result in a flavor that many would detest.

The spice powders used in the paneer butter masala recipe are, chili powder, coriander powder, turmeric powder (optional), and garam masala.

Benefits Of The Spices Used In The Paneer Butter Masala Recipe are:


Image of Cardamom for Paneer Butter Masala

Cardamom or elaichi contains antioxidants and may contain compounds that are capable of fighting cancer. They also aid digestion and have anti-inflammatory properties. Cardamom is also used by many to prevent bad breath.

Cumin Seeds:

Image of Cumin Seeds for Paneer Butter Masala
Cumin Seeds

Popular in India as jeera, cumin seeds are derived from a plant that belongs to the Apiaceae family. This is native to Asia, Europe, and Africa and is used in cuisines across continents.

Cumin is used by many in their weight loss regimen and its medicinal properties have gained high popularity over the years. Cumin seeds also contain antioxidants and may help lower blood sugar and control diarrhea.

Cumin seeds have anti-inflammatory properties and may also help control cholesterol levels.

Bay Leaf:

Image of Bay Leaf for Paneer Butter Masala
Bay Leaf

Bay leaf is a nutrient-dense herb that is used in various Indian recipes. Rich in vitamins and minerals, bay leaves are also known as tej patta.

Thus, bay leaf not just adds flavor to your paneer butter masala, but also provides you some important nutritional benefits.

How To Make Home-Made Garam Masala For This Recipe

If you do not have store-bought garam masala for your paneer butter masala recipe, you can always make some at home. Homemade garam masala is mostly more flavorsome when compared to ready-to-use ones.

If you have all the required spices, then making garam masala at home is as easy as pie. However, it is a fact that you would find different garam masala recipes across the internet, because, figuratively, almost every household follows a unique recipe to make their garam masala.

And maybe that is what makes this mix of warming spices a special ingredient in most Indian cuisine. So, if you have been making garam masala differently from the recipe I provide here, do not worry; you may be right too.

Here is how we make garam masala at home:

  • First of all, we clean all the spices that are used for making the garam masala.
  • The spices we use are green and black cardamoms, coriander seeds, cinnamon, fennel seeds, star anise, and mace (javitri).
  • First of all, look out for stones and debris in small spices and clear them off.
  • Coriander seeds and nutmegs may have worms inside them. Break open a few coriander seeds and the nutmegs to ensure there are not any.
  • Similarly, bay leaves may also have deposits of larvae and mud, which can be cleaned using a damp cloth or tissue paper. Cinnamon often has fungi or larvae inside the swirls, which can also be cleaned using kitchen tissues or a damp cloth.
  • Once all the spices are cleaned and checked for any debris, dry roast them in a pan, one after the other, until the aroma comes out.
  • You could cool them immediately by spreading them on a wide plate or sun-dry them in the hot sun for a day. The spices must be completed cooled down before you toss them in the mixer jar.
  • Blend them well in the blender and sieve.
  • This process can be repeated until all the coarse particles turn fine powder.
  • Let me give you a tip; you could mix the final remaining coarse particles in your tea powder for a flavourful tea. But try some first before you mix them in the entire tea powder, to check how you like the flavor.

Paneer Butter Masala And Paneer Makhani

If you find both the paneer recipes to be confusing, you are not the only one. Many people think that both paneer butter masala and paneer makhani are the same, but in fact, they are different preparations.

While the former recipe is paneer fried in butter and cooked in tomato gravy, the latter makes use of a generous amount of cream and cashews.

Some even confuse paneer butter masala with restaurant-style paneer tikka masala. Even though all these recipes have some similarities, they taste different due to the change in certain ingredients.

And lastly, butter paneer is another confusing term and mostly it could refer to any of these dishes served in restaurants.

Benefits Of Butter

Image of Butter
Image of Butter

Even though butter is high in fat and calories, consuming it in moderation is considered to be good for health. A tablespoon of butter has calories equivalent to that of a medium-sized banana, which is about 100 grams.

Butter is rich in several fat-soluble vitamins, such a vitamin A, vitamin B, Vitamin D, Vitamin E, Vitamin B12, and Vitamin K2.

Allergy Caution

Paneer and butter are milk produces and if you are allergic to milk, it is better to avoid consuming food made using these ingredients.

Other Uses Of Paneer

Paneer is widely used in Indian vegetarian cuisine. It is available in the market as cubes or blocks. Paneer can be used in scramble form or cubes, depending on what the paneer recipes demand.

The bland taste of paneer is great to soak up the flavors of other ingredients used in various preparations.

Restaurant-style paneer tikka masala, Mattar Paneer, Palak paneer, shahi paneer, paneer lababdar, achari paneer, restaurant-style methi Malai paneer, paneer biriyani, paneer paratha, paneer korma, paneer Amritsari recipe, paneer sandwich is some of the popular paneer recipes in India.

Simple paneer recipes are used to make spicy, bland, as well as sweet dishes in different parts of the country.

Paneer And Fasting

For believers, it is important to religiously follow rules related to fasting. The nine days long fasting is of high significance during Navratri. Devotees observe fasting to please the deities and are required to abstain from certain foods during the fasting period.

While non-vegetarian foods, onion and garlic, certain lentils and legumes, table salt, spices, regular rice, and certain regular flours, some spices, and aerated beverages and alcohol have to be avoided, milk is permissible during the fasting period.

Since paneer is milk production, I believe you can have it during fasting. However, make sure you make a small tweak in the paneer butter masala recipe to avoid the spices that are not allowed during fasting.

Butter Paneer Recipe And Keto

A ketogenic diet focuses on healthy fat, low carbohydrate, and a good amount of protein. With the keto diet, the goal is to obtain more calories from fat than from carbs.

The cottage cheese used to make butter masala paneer is rich in protein and fat and has some carbs and is hence a great ketogenic ingredient.

Similarly, butter, which is also high in fat, is allowed while you are on a keto diet. While the key ingredients of the butter paneer recipe are keto-friendly, you can always find a replacement for any other ingredient that may not come under the ketogenic category.

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