Restaurant-style Tofu Butter Masala — an easy, dairy-free version of classic Indian butter paneer using tofu. The tofu is marinated, baked, then simmered in a rich tomato-ginger-cashew sauce for a creamy, flavorful curry. This vegan and gluten-free Butter Tofu (or Tofu Paneer) is perfect with flatbreads, rice, or roti. Jump to Recipe
You must try this Butter Tofu. Whether you call it butter masala, makhani, or simply a rich red butter sauce, this preparation works beautifully with paneer-style tofu, vegetables, or legumes. The makhani-style sauce is a creamy, mildly spiced tomato base that lifts everything it touches. While recipes vary from restaurant to restaurant, this version aims for a restaurant-like balance: bright tomatoes and ginger, rounded cashew cream, a hint of fenugreek, and warming spices.
This recipe uses baked tofu to mimic paneer. The tofu is seasoned, tossed with a light marinade, then crisped in the oven before finishing in the butter sauce. The sauce is dairy-free — use oil or vegan butter if you prefer a richer finish. Serve with your favorite flatbread, vegan naan, rice, or roti.
Video:
More restaurant-style Indian mains from the blog:
- Mushroom Matar Masala
- Bombay Potato and Peas
- Tofu Pasanda
- Tofu Matar Masala
- Tofu in Spinach Curry – Saag Tofu
- Vegetable Jalfrezi – Veggies in smoky tangy curry
- Gobi Broccoli Makhani
- Tempeh Tikka Masala with Kale
If you enjoy this recipe, there are many more options in the author’s Indian kitchen book.
Tips and Troubleshooting
- If the sauce tastes bitter, possible causes include over-mature ginger (can be bitter), tomatoes that haven’t cooked down enough (simmer longer on medium-low until they’re roasted and mellow), or too much dried fenugreek (kasuri methi). Reduce or omit the fenugreek if needed.
- Fenugreek leaves are an authentic flavor in this sauce; if you don’t have them, substitute 1/4 teaspoon powdered fenugreek or 1/4 teaspoon ground mustard. Fenugreek adds a distinctive, slightly sweet-bitter, aromatic note that is common in many North Indian sauces.
- To make this soy-free, swap the tofu for chickpeas, seitan, chickpea tofu, or roasted vegetables.
Step-by-Step Photos
Marinate the tofu, then bake.
Baked and ready for the sauce.
Some elements of this recipe are inspired by traditional paneer makhani techniques. The sauce benefits from a bit of oil or vegan butter, and canned diced tomatoes help deepen the color and flavor if fresh tomatoes are not ideal.
Fold in the baked tofu, add sliced ginger and thinly sliced green chile for freshness and heat, and serve hot. Garnish with a drizzle of the reserved cashew cream and chopped cilantro, and enjoy with naan, roti, or rice.
What Is Butter Masala?
Butter masala, often called makhani sauce, is a creamy, tomato-based curry sauce commonly found on North Indian restaurant menus. It’s mildly spiced, slightly sweet, and richly textured, traditionally served with meats or paneer. This vegan take swaps dairy for cashew cream (or coconut cream for a nut-free option) and uses baked tofu to mimic the texture of paneer. For a more indulgent restaurant-style finish, add extra oil and vegan butter to the sauce.
Butter Tofu Paneer – Restaurant Style Tofu Butter Masala Recipe
Ingredients
Baked Tofu “Paneer”
- 12 oz firm tofu, pressed and cubed
- 1/2 tsp each garam masala, paprika, salt, and turmeric
- 2 tsp ginger paste or minced ginger
- 2 tsp garlic paste or minced (or 3/4 tsp garlic powder)
- 2 tsp lemon juice
- 1.5 tsp water (about 1/2 tbsp)
- 1.5 tbsp cornstarch or arrowroot
- 1 tsp nutritional yeast (optional)
- 1 tsp oil
Butter Sauce
- 1 tsp oil or vegan butter
- 3 garlic cloves, finely chopped
- 3 large ripe tomatoes or 1 (15 oz) can diced tomatoes
- 1-inch cube ginger (reserve half for garnish), chopped and julienned
- 1 hot or mild green chile, julienned or thinly sliced (or thinly sliced green bell pepper)
- Cashew cream: 1/4 cup cashews soaked 15 minutes, blended with 1/2 cup water
- 1/2 tsp garam masala
- 1/2 tsp paprika (or Kashmiri chili powder)
- 1/4 to 1/2 tsp cayenne (to taste)
- 1/2 cup water (use to adjust sauce consistency)
- 1 tsp kasuri methi (dried fenugreek leaves)
- 1/2 tsp salt
- 1/2 tsp sugar or other sweetener, to preference
Instructions
Bake the Tofu
- Press and cube the tofu. In a bowl, combine the marinade ingredients listed under “Baked Tofu” (spices, ginger, garlic, lemon juice, water, cornstarch, nutritional yeast, and oil). Toss the tofu in the marinade and let sit 15 minutes if time allows.
- Preheat the oven to 400°F (200°C). Arrange the tofu cubes on a parchment-lined baking sheet and bake 15–20 minutes until lightly golden and firm.
Make the Butter Sauce
- Heat oil in a skillet over medium heat. Add chopped garlic and cook until golden. Optionally, add a bay leaf and a small cinnamon stick for extra aroma, removing them before serving.
- Puree the tomatoes with chopped ginger and half of the green chile. Add the puree to the skillet and cook until it thickens and the raw tomato taste is gone.
- In the same blender, blend the soaked cashews with water until very smooth. For extra creaminess, blend in two short bursts, letting the mixture rest briefly between blends. Unsoaked cashews also work if your blender is powerful.
- Reserve 1 tablespoon of cashew cream for garnish. Add the remaining cashew cream to the skillet along with garam masala, paprika, cayenne (if using), kasuri methi, salt, and sugar. Use 1/2 cup water to rinse the blender and add to the skillet. Bring to a gentle boil and adjust seasoning, heat, and sweetness to taste. Add more water to reach your preferred consistency, or more cashew cream for extra richness.
- Fold in the baked tofu and simmer for about a minute to combine flavors. Stir in the julienned ginger and sliced chile (or reserve half as garnish). Drizzle the reserved cashew cream and finish with chopped cilantro or other garnishes if desired. Serve hot with naan, roti, or rice.
Notes
Soy-free option: Simmer the sauce with chickpeas for 8–10 minutes, or add roasted vegetables such as cauliflower, bell peppers, or zucchini (rub with the tofu marinade and roast at 400°F for 25–30 minutes), then simmer briefly in the sauce.
Butter “chikin”: Use vegan chicken strips or seitan. Toss with garam masala, paprika, minced ginger, minced garlic, and oil; cook briefly, then simmer in the sauce with about 1 cup water for 10 minutes.
Nut-free: Substitute coconut cream (the thick white part from a can of full-fat coconut milk) for cashew cream.
Fenugreek substitute: If you don’t have kasuri methi, use 1/4–1/3 tsp powdered fenugreek or 1/4 tsp ground mustard.
No onion/garlic option: This recipe is already onion-free. To omit garlic, add zucchini to help build body in the sauce and increase kasuri methi slightly to balance flavors.
Nutrition values are estimates based on one serving.
Nutrition (per serving, approximate)
Calories: 166 kcal • Carbohydrates: 14 g • Protein: 8 g • Fat: 8 g • Saturated Fat: 1 g • Sodium: 658 mg • Fiber: 2 g • Sugar: 4 g • Vitamin A: 910 IU • Vitamin C: 16.4 mg
Nutrition information is automatically calculated and should be used as an approximation.