Paneer Mushroom Capsicum Masala Recipe

Paneer Mushroom Capsicum Masala – Chunks of paneer, mushroom and capsicum cooked in a rich, spicy and delicious gravy

paneer mushroom capsicum masala

Paneer Mushroom Capsicum Masala recipe with step by step photos. I made this delicious paneer mushroom capsicum masala to use up the leftover paneer and mushroom. This dish has a semi-gravy consistency. It is such a great accompaniment to pulao or any indian flatbreads. Paneer, mushroom and capsicum always make an exotic combo. The addition of butter and crushed kasoori methi enhance the taste of this masala. Each piece of paneer, mushroom and capsicum is coated with rich, spicy masala. Chopping the onion as fine as possible, frying onions till golden brown, using coarsely ground ginger & garlic, simmering the veggies till done and addition of crushed kasoori methi at last are the secrets to making good paneer mushroom capsicum masala. Try this recipe and you will love it !

recibites_iconPaneer is rich in protein and calcium.

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Paneer Mushroom Capsicum Masala Recipe:

Cuisine : Indian
Category : Side dish for roti / pulao
Makes : 3 servings

Preparation Time : 10 min
Cooking Time :  20-25 min

Paneer Mushroom Capsicum Masala – ReciCode

Put paneer cubes in salted hot water → Heat oil+butter → Add cinnamon, cloves, cardamom & fry for 3-4 sec → Add chopped onions & fry till golden brown → Add coarsely ground ginger+garlic, slit green chillies → Fry till raw smell goes → Add tomato puree → When half cooked, add red chilli powder, coriander powder, garam masala powder, cumin powder & pepper powder → Fry till oil separates → Add cubed paneer, cubed capsicum & chopped mushroom → Mix well & add a cup of water → Simmer till the veggies are cooked → Switch off once done → Sprinkle crushed kasoori methi & serve.

Ingredients :

  • 200 g Paneer, cubed
  • 200 g Mushroom, chopped 
  • 1 medium size Green Bell Pepper, cubed
  • 1 large Onion, finely chopped
  • 2 tbsp Ginger Garlic Paste (coarsely ground)
  • 2 slit Green Chillies
  • 2 Tomatoes, pureed
  • 3/4 tsp Red Chilli Powder
  • 2 tsp Coriander Powder
  • 1 tsp Garam Masala Powder
  • 1 tsp Cumin Powder
  • 1/4 tsp Pepper Powder
  • 1 tsp Kasoori Methi
  • 1″ stick Cinnamon
  • 2 Cardamom
  • 2 Cloves
  • 1 tbsp Oil
  • Salt as required

 How to make Paneer Mushroom Capsicum Masala?

1. Before starting, put the paneer cubes in salted hot water. I feel paneer becomes soft if put in salted hot water for sometime. If you want to fry the paneer, fry in oil till light brown and put in hot water till they are used so that they remain soft.

2. Heat oil and butter in a pan. If you are using butter immediately after taking it out from refrigerator, it might burn very soon. In that case, heat the oil first over low flame and then add the butter. When the butter melts completely, you may start cooking.

3. Add cinnamon stick, cloves and cardamom. Fry for 3-4 seconds over medium flame.

4. Add finely chopped onion. Sprinkle some salt and saute till they become golden brown.

5. Add coarsely ground ginger + garlic and slit green chillies. Coarsely ground ginger and garlic adds a good flavor to the masala. You may also grind ginger and garlic to a smooth paste.

6. Fry till the raw smell goes off completely.

7. Add the pureed tomatoes and mix well.

8. When the tomato is half cooked, add red chilli powder, coriander powder, garam masala powder, cumin powder and pepper powder. Fry till the raw smell disappears and oil separates.

9. Add the cubed paneer, chopped mushroom and cubed green bell pepper. Click here to check how to clean mushrooms.

10. Mix well so that the masala coats all the pieces.

11. Pour a cup of water.

12. Simmer till the capsicum and mushroom are cooked. The masala should have a semi-gravy consistency. Add water if the curry becomes dry.

13. Switch off the stove once the veggies are cooked.
14. Crush kasoori methi between your palms and sprinkle over the curry.

15. Mouthwatering paneer mushrrom capsicum masala is ready ! Serve this with any indian flat breads or pulao.


  • If paneer is fried for a long time, it becomes rubbery and hard to chew.
  • If you do not have time, you need not soak the paneer cubes in salted hot water or fry in oil. Just add them directly to the gravy. 


Happy Cooking!


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