Paneer Butter Masala Recipe – Authentic Indian Gravy with Cashews

Last Updated on 2 months by Neha Deshmukh

Paneer Butter Masala Recipe – Authentic Indian Gravy with Cashews

Hello friends! If you’re anything like me, a cozy night in often calls for a rich, creamy, and utterly delicious Indian curry. And honestly, nothing hits the spot quite like a perfectly made Paneer Butter Masala. I first made this when I was craving something comforting after a long week, and it quickly became a family favorite. Today, I’m so excited to share my go-to recipe with you – complete with all the secrets to that authentic, restaurant-style flavor!

Why You’ll Love This Recipe

This isn’t just another Paneer Butter Masala recipe. We’re building layers of flavor with a cashew-based gravy, a touch of sweetness from mawa (khoya), and that signature smoky finish from kasuri methi. It’s a little bit of effort, but trust me, the result is SO worth it. Plus, it comes together surprisingly quickly in the Instant Pot! You’ll love how easy it is to create this classic dish at home.

Ingredients

Here’s what you’ll need to make this dreamy Paneer Butter Masala:

• 200 grams Paneer, cubed
• 3 tablespoons Oil
• 1 small piece Mace blade
• 2 Green Cardamoms
• 0.75 cup Chopped Red Onion
• 1 clove Garlic
• 0.5 teaspoon Salt
• 0.25 teaspoon Turmeric Powder
• 0.5 teaspoon Coriander Powder
• 0.5 teaspoon Chili Powder / Cayenne Pepper
• 1 cup Diced Tomato
• 0.25 cup Cashew Nut Powder
• 0.25 teaspoon Garam Masala
• 1 tablespoon Mawa/Khoya
• 0.5 teaspoon Green Cardamom Powder
• 0.25 teaspoon Nutmeg Powder
• 0.25 teaspoon Dry Fenugreek Leaves (Kasuri Methi)
• 1 cup Water (plus a little extra if needed)

Ingredient Notes

Let’s talk ingredients! A few things really make this recipe shine:

• Mawa/Khoya: This adds a beautiful richness and subtle sweetness. If you can’t find it, you can substitute with ricotta cheese (drained well) or even a tablespoon of cream cheese, though the flavor won’t be exactly the same.
• Cashew Powder: Don’t skip this! It’s the base of our creamy gravy. You can make your own by grinding cashews into a fine powder.
• Kasuri Methi: These dried fenugreek leaves add a unique smoky aroma that’s essential for authentic Paneer Butter Masala. Crush them between your palms before adding to release their flavor.
• Spice Levels: Indian cooking is all about personal preference! Feel free to adjust the chili powder to your liking. Some families prefer a milder flavor, while others like a good kick. I usually aim for medium, but I’ll share how to adjust it later.

Step-By-Step Instructions

Alright, let’s get cooking!

1. First, turn on the sauté function of your Instant Pot. Add the oil, then toss in the chopped onion and garlic. Sauté for 1-2 minutes, until the onions start to soften and turn translucent.
2. Now, add the diced tomatoes, turmeric powder, coriander powder, chili powder, salt, and 1 cup of water. Give everything a good stir.
3. Secure the lid on your Instant Pot. Pressure cook on high for 4 minutes. Once it’s done, let the pressure release naturally for 11 minutes. Then, carefully open the lid and use an immersion blender (or transfer to a regular blender) to blend the mixture into a smooth, velvety puree.
4. Switch the Instant Pot back to sauté mode. Add the cashew powder and mix well, ensuring there are no lumps. Stir in the garam masala and mawa/khoya. Let it simmer for a minute or two, stirring constantly, until everything is well combined.
5. Gently add the paneer cubes, cardamom powder, nutmeg powder, and kasuri methi. Mix gently to coat the paneer with the luscious gravy. Be careful not to break the paneer!
6. Finally, transfer your beautiful Paneer Butter Masala to a serving bowl. Garnish with a little extra mawa and some roasted cashew halves for a touch of elegance. Serve hot with your favorite flatbread – naan, roti, or paratha are all perfect!

Expert Tips

• Don’t overcook the paneer! It can become rubbery. Adding it at the end ensures it stays soft and tender.
• If the gravy is too thick, add a splash of water to reach your desired consistency.
• For a richer flavor, you can add a tablespoon of butter at the very end.

Variations

Want to switch things up? Here are a few ideas:

• Vegan Adaptation: Use plant-based paneer and substitute the mawa/khoya with a cashew cream (soaked cashews blended with water).
• Gluten-Free: This recipe is naturally gluten-free! Just double-check the ingredients in your garam masala to be sure.
• Spice Level: For mild, reduce the chili powder to ¼ teaspoon. For hot, increase it to ¾ teaspoon or add a pinch of cayenne pepper. My friend, Priya, loves to add a finely chopped green chili for extra heat!
• Festival Adaptations: This dish is perfect for celebrations like Diwali or Holi. It’s a crowd-pleaser and always disappears quickly!

Serving Suggestions

Paneer Butter Masala is best served hot with:

• Naan bread
• Roti or Paratha
• Steamed Basmati Rice
• A side of raita (yogurt dip)

Storage Instructions

Leftovers can be stored in an airtight container in the refrigerator for up to 3 days. Reheat gently on the stovetop or in the microwave. The gravy may thicken upon refrigeration, so add a splash of water or milk when reheating.

FAQs

1. What is Mawa/Khoya and can I substitute it?

Mawa, also known as khoya, is a milk solid commonly used in Indian sweets and curries. It adds a unique richness and flavor. If you can’t find it, you can substitute with well-drained ricotta cheese or cream cheese, but the flavor will be slightly different.

2. Can I make this Paneer Butter Masala ahead of time?

Yes, you can! You can make the gravy ahead of time and store it in the refrigerator for up to 2 days. Add the paneer just before serving.

3. What type of paneer works best for this recipe?

I prefer using fresh, soft paneer. If you’re using frozen paneer, make sure to thaw it completely and gently squeeze out any excess water before adding it to the gravy.

4. How do I adjust the spice level to my preference?

Simply adjust the amount of chili powder! Start with ¼ teaspoon for mild, ½ teaspoon for medium, and ¾ teaspoon or more for hot.

5. Can I use a regular pot instead of an Instant Pot?

Absolutely! Sauté the onions and garlic in a regular pot, then add the tomatoes and spices. Simmer for about 20-25 minutes, or until the tomatoes are softened and the gravy has thickened. You may need to add a little more water to prevent sticking.

Enjoy! I hope this recipe brings a little bit of Indian sunshine to your kitchen. Let me know in the comments how it turns out for you!