This Paneer Butter Masala, also known as Paneer Makhani, is incredibly delicious and so easy to make in the Instant Pot. Soft paneer cubes are simmered in a rich, mildly spiced tomato-based gravy that’s creamy, comforting, and full of flavor.
Paneer Butter Masala, also called Butter Paneer or Paneer Makhanwala, is one of the most popular Indian curries. It has soft paneer (Indian cottage cheese) cooked in a creamy tomato and onion gravy. This curry is rich, flavorful, and so delicious that even picky eaters will love it—just like my daughters!
And the best part? You can make it easily in the Instant Pot or on a stovetop pressure cooker with very little prep—no sauteeing or babysitting the curry while it is cooking in this recipe.
If you like paneer, check out other instant pot curry recipes – Palak Paneer, Paneer Tikka Masala, and Saag Paneer.
Table of Contents
Watch How to Make Paneer Butter Masala
Ingredients You’ll Need
- Paneer (Indian cottage cheese): Paneer is the key ingredient in this dish. It’s a soft cheese that doesn’t melt and is readily available at Indian stores. I recommend Haldiram’s paneer for its softness and flavor. If frozen, thaw it overnight or soak it in warm water for 15–20 minutes. For a vegan option, use firm tofu in this recipe, similar to my tofu tikka masala recipe.
- Tomatoes: Fresh, juicy tomatoes give the gravy a rich and slightly sweet flavor. You don’t need to chop them finely—they’ll be blended later.
- Onion: I use yellow onions in this recipe.
- Garlic & Ginger: Diced ginger and garlic work well, as we will be blending them all once cooked.
- Green Chili: Adds a gentle heat. You can skip it if making the dish for kids or if you prefer a mild flavor.
- Whole Spices: You’ll need cinnamon stick, green cardamom pods, black cardamom pods, cloves, cumin seeds, and black peppercorns. If you don’t have whole spices, just skip these and add 1 teaspoon Garam Masala at the end.
- Ground Spices: You’ll need turmeric powder, coriander powder, cumin powder, red chili powder, and salt.
- Cashews: They make the curry creamy and naturally sweet. No need to soak—just pressure cook along with the other ingredients.
- Butter: Adds a rich and indulgent flavor. Ghee (clarified butter) is a great substitute. For a vegan version, use a plant-based butter.
- Cream: Added at the end to make the curry creamy and smooth. For a vegan option, use coconut milk.
- Honey: Balances the tanginess from the tomatoes and adds a hint of sweetness.
- Kasoori Methi: This gives the curry a restaurant-style aroma and taste.
Tips & Variations
Make Ahead: You can make the gravy in advance and freeze it. Just add paneer later when reheating.
No Paneer? Add green peas, tofu, mushrooms, or even roasted cauliflower.
Butter Chicken: Add raw chicken thighs before pressure cooking (cook 10 mins). Then shred or cut and add back to the sauce.
Vegan Option: Use tofu instead of paneer, and coconut milk instead of dairy cream.
Quick Meal Tip: Cook basmati rice in a bowl using the pot-in-pot method while the curry pressure cooks.
Make it Nut-free: Some people are allergic to cashews or any nuts. You can either just skip the cashews and add some extra heavy cream. If you can find, use 2-3 tablespoons of melon seeds (magaz) in place of cashews. They make the gravy thicker, while keeping it nut-free.
Using Store-bought Tomatoes: You can use store-bought diced tomatoes in this recipe in place of fresh tomatoes. If using store-bought tomato puree (passata), then add 1/4 cup extra water, as puree can sometimes stick to the bottom and cause a burn. Make sure to add tomatoes as the last ingredient before pressure cooking, and do not stir, as sometimes they can cause a burn.
How to Make Instant Pot Paneer Butter Masala?
The preparation for this paneer butter masala is very different than the usual onion-tomato gravy. Usually, to make gravy, we first sauté onions and then sauté tomatoes. However, this one is done in a completely different way.
Make a spice pouch by adding all the whole spices to a small piece of cheesecloth. Tie it tightly so the spices don’t come out while cooking.
Note: If you don’t have a spice bag, you can skip the whole spices and add about a teaspoon of Garam Masala (adjust to taste) at the end.
Now add all the ingredients except paneer, cream, and honey to the Instant Pot. Don’t forget to add the spice pouch too. Close the lid and turn the valve to the sealing position.
Set the Instant Pot to Pressure Cook (or Manual) mode and cook on high pressure for 8 minutes.
When it’s done, let the pressure release naturally. Then, open the lid and take out the spice pouch carefully.
Note: Follow the same steps as above if cooking in a stovetop pressure cooker. Pressure cook for 2 whistles on medium-high flame. Then let the pressure release naturally.
Use an immersion blender to blend everything in the pot into a smooth gravy. You can also use a regular blender, such as a Vitamix, to blend the sauce. Let the mixture cool a bit, then blend and pour it back into the pot.
Add the cream and honey, and stir well. Then add the paneer cubes and mix gently.
Cover with a lid and let it sit for 5 minutes so the paneer soaks in the flavors.
Your Paneer Butter Masala is ready! Garnish with kasoori methi (dried fenugreek leaves) or fresh cilantro, and enjoy with naan, roti, or rice.
How to Serve?
Isn’t it a lovely color? And the easiest dish to prepare? This is my go-to dish when I have not done much preparation…and oh, perfect to serve if you have guests coming over.
Love this gravy? Make it a dip with naan and serve it as an appetizer. This used to be a complimentary appetizer served at an Indian restaurant I frequently visited in Chicago.
How to Store?
You can store any leftovers in the refrigerator for up to 3 days.
This gravy also freezes well. Prepare in advance and freeze. Then, when needed, defrost, boil, and add chunks of paneer.
Fun Fact: This is the original image I clicked for this recipe 8 years back, when I first published it in 2017.
Don’t forget to check out my post on 23 Best Instant Pot Indian Recipes.
More Paneer Recipes You’ll Love
Hariyali Paneer Tikka
Paneer Vindaloo
Matar Paneer – Instant Pot & Stovetop
Paneer Paratha
Paneer Butter Masala (Instant Pot & Stovetop)
Video
Ingredients
- 1 lb Paneer or Cottage cheese, chunks (use firm tofu for vegan)
- 2 tablespoon Butter
- 1 Green chili pepper , (optional)
- 1 teaspoon Cumin seeds (Jeera)
- 1 Onion, cut in large pieces, about 1.5 cups
- 1 inch Ginger, grated or finely diced
- 6 cloves Garlic, minced
- 4 Tomato, cut in large pieces
- 1/4 cup Cashews
- 2 tablespoon Dried Fenugreek leaves (Kasoori Methi)
- 1/4 cup Water
- 1/4 cup Cream, heavy whipping cream (coconut milk for vegan)
- 1 tablespoon Honey
- 1 teaspoon Salt, adjust to taste
Ground Spices
- 1/2 teaspoon Ground Turmeric (Haldi powder)
- 1 teaspoon Coriander powder (Dhaniya powder)
- 1/2 teaspoon Ground Cumin (Jeera powder), or Garam Masala
- 1-2 teaspoon Kashmiri red chili powder, adjust to taste
Whole Spices
- 1 inch Cinnamon (Dalchini)
- 5 Green Cardamom (Elaichi)
- 2 Black Cardamom (Moti Elaichi)
- 1/2 teaspoon Black Peppercorns
- 12 cloves Cloves (Laung)
Instructions
- Make a spice pouch by adding the whole spices to a cheesecloth. Tie it such that the spices cannot come out of it.
- Except for paneer, cream, and honey, add all ingredients, including the whole spices pouch and ground spices to the Instant Pot. Close the lid with the vent in the sealing position.
- Set the instant pot to manual or pressure cook mode on high pressure for 8 minutes.
- After the instant pot beeps, release the pressure naturally. You can also do a 15 minute natural pressure release.
- Remove the spice pouch carefully. Blend the contents in the instant pot with an immersion blender or regular blender to a smooth paste. If using regular blender, you may need to cool the ingredients before blending. Get the contents back to the instant pot.
- Add the cream and honey. Stir into the sauce.
- Add paneer chunks. Stir them into the sauce and let it rest for 5 minutes. You can cover with a glass lid.
- Paneer Butter Masala is ready to be served. Garnish with dry fenugreek leaves or cilantro.
Stovetop Pressure Cooker
- Follow the same steps as above if cooking in a stovetop pressure cooker. Pressure cook for 2 whistles on medium-high flame. Then let the pressre release naturally.
Notes
- Matar Paneer / Mushroom Matar / Roasted Cauliflower – You can also add different veggies to this sauce and make delicious curries. All of the veggies can be added after making the sauce. Simmer for 3-4 minutes on saute mode to cook the veggies.
- Butter Chicken or Murgh Makhani – You can also cook butter chicken with this recipe. Add chicken thigh pieces on top of the other ingredients before pressure cooking. Cook for 10 minutes at high pressure. Remove chicken and cut into 2-3-inch pieces. Add back to the sauce. Voila, butter chicken is ready!
- Love this gravy? Make it a dip with naan and serve it as an appetizer.
- Vegan: To make this curry vegan, replace cream with coconut milk and paneer with tofu or vegetables.
I love this recipe. Do you think I can substitute heavy cream with sour cream?
Hi Sudha – You can add a little sour cream. I suggest just tasting as you add more, we don’t want to make the curry too sour.
The button to change serving size doesn’t work
Hi Sheetal – Thanks for letting me know. I just tried on my laptop and it worked. You can also use the 1x-2x-3x option to adjust the serving size. I hope that helps!
I don’t have honey, can I use sugar instead?
Hi Becky – sure, sugar will work too. Hope you enjoy the curry!
If I wanted to make this without onions and garlic should I make any other alterations?
Hi Keven – I feel the recipe will work well even if you skip onions and garlic. Would love to hear how it turns out!
How can I replace fresh tomatoes with tomato pulp or canned tomatoes? Please let me know the equivalent measures? Thanks!
Hi Jyothi – Sure, you can use canned tomatoes. For canned whole tomatoes, you can still include the same number as in the recipe. For diced, one can is about 4-5 tomatoes. Adjust the quantity accordingly. Make sure to add tomatoes as the last ingredient before pressure cooking and do not stir, as sometimes they can cause a burn. I hope you enjoy the paneer butter masala!
Thanks Meeta for your prompt response. Could you mention the can size too. Thanks!
Usually the diced canned tomatoes are 14oz. So one can would work in this recipe.
What could be substituted for cashews as my son is allergic to nuts?
Hi Mala – Cashews mainly help to thicken the curry. You can just add a little extra heavy cream at the end and skip the cashews. You could also try adding sunflower seed butter (typically used as a replacement for peanut butter) if you like the taste.
This recipe is amazing! And so easy. I adapted it for the stove top by doubling the water. And I used garbanzo beans instead of paneer. Thank you!!
Hi Tori – Happy to hear you enjoyed the curry!
I used two 4 inch cinnamon sticks and my dish became too cinnamony. Could you please add the length of cinnamon sticks and if they should be single layered? Sometimes each stick has multiple layers.
Hi Vivek – Sorry for the confusion in amount of cinnamon. I just updated the recipe to make it clearer to use about 1 inch cinnamon. Use a single layer. Hope you try the recipe again!
Great! Thanks, Meeta! Can’t wait to try it again! Huge fan of your recipes!
Hi Meeta,
Love your recipes, I had a question , do I add the cream and honey too incase i need to freeze the batch .I am planning to make this for a group of 15 people. Thank you
Question for you- If you were to double (or triple) this recipe, would you still double the whole spices too?
Also- so thankful you’re sharing your wonderful recipes. Everything I’ve made from this site has been amazing! Thank you! So glad I found you!
Hi Mel – Yes, I would suggest to proportionally increase the whole spices. So glad that you are enjoying the recipes from the blog. Thank you for sharing back!