Paneer Butter Masala

Paneer Butter Masala, also known as butter paneer is a rich & creamy curry made with paneer, spices, onions, tomatoes, cashews and butter. Both paneer tikka masala and paneer butter masala have the same tomato-based gravy and cashew paste for thickness. But in paneer tikka masala, paneer is marinated by mixing with masala and is roasted until golden brown. While in paneer butter masala, paneer is directly added to the gravy or roasted and added to the gravy. Also, paneer butter masala is slightly sweet in taste whereas paneer tikka masala is spicier.


  • 2 cups paneer cubes
  • 2 large tomatoes
  • 2 medium onions
  • 4 garlic cloves
  • 3 dried red chilies
  • 8-9 cashews
  • 1-inch ginger
  • 3 bay leaves
  • 3 tbsp butter
  • 1 tbsp oil
  • Salt

  • ½ tsp turmeric powder
  • 1 tsp red chili powder
  • 1 tsp garam masala
  • 1.5 tsp coriander powder
  • ¼ cup mild cream


  • In a pan, add oil and heat it
  • Add ginger, garlic and red chilies
  • Once garlic changes color, add onion pieces
  • Cook until onion turns golden and soft

  • Add tomato pieces, mix, cover and cook
  • After 2-3 minutes, add cashew pieces
  • If cashew pieces are very old, soak them in hot water for 5 minutes, discard water and use cashews (it removes stale smell)
  • Mix, cover and cook the mixture until tomatoes become very soft
  • Turn off the stove and cool down the mixture

  • Grind the mixture to super soft paste
  • Strain the paste to get rid of seeds and skin
  • Smooth and silky paste is ready
  • Keep it aside
  • In a pan, add butter and bay leaves
  • Now add 1 cup of finely chopped onions
  • Saute until onions turn golden brown
  • Keeping the flame on low, add turmeric powder, red chili powder, salt, garam masala and coriander powder

  • Mix well and saute until the spices turn aromatic
  • Add prepared smooth onion-tomato-cashew paste to it
  • Cook until the oil separates from the masala paste
  • Now, add 1 cup water and mix well adjusting the consistency
  • After 2 minutes, add cream
  • I used milk+milk powder paste in place of cream

  • Lastly, add paneer cubes and mix gently
  • Simmer for 5 minutes or until paneer absorbs the flavor

  • Turn off the stove
  • Enjoy paneer butter masala with roti or naan!

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