This quick & easy, restaurant-style Chili Paneer recipe features crispy paneer cubes stir-fried with crunchy onions, peppers, and whole red chilies in an umami-packed sauce. It's a popular Indo-Chinese dish ready in 25 minutes, best served with rice or chowmein.
Want to save this recipe?
We'll email this post to you, so you can come back to it later!
When I was in high school, the Indo-Chinese food truck near my neighborhood was where I'd land with my friends after almost everything - after exams, on free afternoons, whenever there was an excuse.
Chilli paneer was always the first order: crispy paneer tossed in that spicy, tangy sauce with crunchy peppers, gone before anything else hit the table. I've been chasing that version ever since, and this recipe is as close as I've gotten.
The best part about this recipe is that a simple tweak to the sauce lets you enjoy it as an appetizer or a weeknight meal.
What is Chilli Paneer?
Chilli Paneer is one of India's most popular Indo-Chinese dishes - crispy pan-fried cubes of paneer (Indian cottage cheese) tossed in a spicy, tangy, umami-packed sauce with peppers and onions.
It's a permanent fixture on Indo-Chinese restaurant menus, enjoyed as both a party appetizer and a weeknight meal. The dish comes in two styles: dry, where just enough sauce clings to each piece, and gravy, a richer, saucier version that pairs beautifully with fried rice or noodles - this recipe shows you how to make both.
Jump to:
Why We Love It
My family (especially hubby and I) love Chinese food. This chilli paneer is one of my go-to dishes whenever we're craving Chinese take-out. Not only does it taste delicious, but this recipe is great because:
- It's a lighter and healthier version of the traditionally battered and deep-fried chili paneer.
- It makes for a satisfying high-protein vegetarian meal. Enjoy it with vegetable chow mein or steamed rice for a complete meal.
- Serve it as stuffing for lettuce cups and enjoy a delicious low-carb meal!
- The high-heat stir-fry technique means I can get it on the table in only 25 minutes!
- Two sauce variations give me the flexibility to serve it as an appetizer or main meal.
Let's get started with this Easy Chili Paneer with Stir-Fried Onions and Peppers!
Ingredients - Notes & Availability
The ingredients for chili paneer are a mix of Indian and Chinese staples easily found in specialty markets or the global food section of most grocery stores.
- Paneer: a fresh, non-melting cheese popular in Indian cuisine. I make it at home using this easy homemade paneer recipe, or buy it at Indian grocery store, Whole Foods, or Costco. My preferred brands include Verka, Haldiram, or Desi Paneer. Look for it in the dairy or freezer section (Note: If frozen, defrost overnight in the fridge or on the countertop in a bowl of cool water for 1-2 hours).
- Vegetables: Use red or white onion. Green pepper is my preference in this recipe, but feel free to use other colors if you like. Cut both in 1-inch chunks. Separate the onion layers for stir-frying.
- Aromatics: Ginger, garlic, and spring onions give this dish an aromatic flavor. Mince garlic and ginger for an authentic texture.
- Soy Sauce: Dark soy sauce is thicker, slightly sweeter, and less salty than regular soy sauce. It is also aged longer. This intensifies that sought-after umami flavor and creates a deeper, richer sauce. It is available in most grocery stores in the Asian food section or online.
- Corn Starch: Unlike the traditional recipe, which combines cornstarch and all-purpose flour to coat the paneer cubes, I find that just cornstarch gets the job done with lighter, crisper results. Feel free to use rice flour, potato starch, tapioca starch, or arrowroot flour instead.
- Dried Red Chilies: Supermarkets stock a decent selection. I use the dried chilies marked as 'Asian' or 'Indian'.
- Rice Vinegar: Rice vinegar is a popular ingredient in Asian cooking because of its mild acidity and sweetness. Look for white rice vinegar (sometimes labeled rice wine vinegar) in the global section of grocery stores. Do not purchase seasoned rice vinegar that is typically flavored with sugar or corn syrup, salt, or MSG.
Scroll to the recipe card for a detailed list of ingredients and quantities.
How to Make Chilli Paneer
There are a few sauce variations for making chili paneer at home (which we will discuss in a bit), but the recipe as written yields a semi-dry consistency.
- Step 1: Season Paneer. Toss paneer cubes in soy sauce. Now add cornstarch and toss till it forms a thin batter with the soy sauce and coats the paneer pieces well
- Step 2: Pan-fry Paneer. Heat a skillet over medium-high heat. Add oil, then spread the paneer in a single layer. Cook for 2 minutes per side, until golden brown. Remove and set aside, then repeat with the remaining paneer.
- Step 3: Sauté Aromatics. Heat the same skillet, add the remaining tablespoon of avocado oil and add chopped ginger, garlic and dried red chilies. Stir and sauté for 1 minute.
- Step 4: Sauté veggies. Add the onion and peppers and stir-fry for 4-5 minutes, until the onions start to turn translucent but are still firm. Toss in the browned paneer pieces.
- Step 5: Prepare Sauce. In a bowl, mix the sauce ingredients until the cornstarch (corn flour) is fully combined. Pour the sauce over paneer, onions, and peppers, and stir until it coats everything evenly and starts to thicken.
- Step 6: Garnish & Serve. Turn off the heat when it reaches your desired thickness, about 2-3 minutes (see notes about making a dry version or gravy version). Garnish with sliced green onions.
Serving Suggestions & Leftover Makeover
This semi-dry chilli paneer recipe can be served as an appetizer or meal.
To serve as an appetizer, simply serve it on a platter with cocktail picks. Or, pair it with vegetable chow mein, steamed Jasmine rice, or fried rice to sop up all those flavors and enjoy a hearty meal.
If we happen to have leftovers in the fridge (will keep in an airtight container for up to 4 days), we add it to whole wheat tortillas and create our own chilli paneer wrap for a quick grab-and-go meal.
Variation: Paneer Chilli with Gravy
- Loosen the sauce: Mix the sauce ingredients as directed, then whisk in ½ cup water or vegetable broth until fully combined with the cornstarch. This turns the thick coating sauce into a pourable gravy base.
- Build the stir-fry base: Sauté the ginger, garlic, and dried red chilies for 1 minute, then add the onion and peppers and cook for 4-5 minutes, until just starting to soften but still holding some crunch.
- Return the paneer to the pan: Toss the browned paneer cubes back in with the vegetables.
- Add the gravy sauce and simmer: Pour in the broth-thinned sauce and stir well. Simmer for 2-3 minutes, stirring occasionally, until the sauce thickens to a glossy, spoonable consistency.
- Adjust and serve: Taste and add a pinch more salt or chili paste if the extra liquid has mellowed the flavor. Garnish with sliced green onions and serve hot over steamed rice or noodles.
Recipe Tips & Notes
- Use dark soy sauce for a richer flavor. For umami-packed results, I like to use dark soy sauce. It adds a nice deep amber color and an intense flavor. If you only have regular soy sauce on hand, add another ½- 1 tablespoon, depending on how salty you like your dish.
- Alter the sauce to make dry or with gravy. This recipe results in a semi-dry dish, popularly known as 'Dry Chilli Paneer' in restaurants. To make more sauce, simply add ½ cup water or broth to the sauce mix and simmer for 2-3 minutes.
- A wonderful vegetarian recipe you can make gluten-free or vegan. Paneer is a great vegetarian adaptation of chilli chicken. Simply use tamari instead of soy sauce for a gluten-free version. You can also substitute the paneer with extra-firm tofu to make it vegan.
- Make this recipe Vegan by substituting paneer with extra-firm Tofu cut into bite-sized pieces.
Troubleshooting & FAQ
The best way to dry the outer surface of the paneer is with cornstarch. The cornstarch basically acts like a sponge and soaks up any extra moisture.
Paneer turns rubbery when it's overcooked. Stir-frying it on high heat for more than a couple of minutes at a time pulls out too much moisture - stick to medium-high heat and pull each batch the moment it's golden on both sides.
You can prep the components a day ahead - marinate and fry the paneer, and chop the onion and peppers - then store them separately in the fridge. I'd hold off on making the sauce and combining everything until just before serving, since the paneer is best fresh off the heat and the vegetables lose their crunch the longer they sit in sauce.
Toss the marinated paneer cubes in the air fryer at 400°F for about 8-10 minutes, shaking the basket halfway, until golden and crisp. You'll lose a little of the deep-fried crunch, but it's a solid, lower-oil option, and the rest of the dish comes together the same way.
Usually the cornstarch settled at the bottom of the bowl before it hit the pan, or the sauce didn't get enough time over heat. Give the sauce mixture a final stir right before pouring it in, and let it bubble for the full 2-3 minutes - it thickens fast in the last minute, so don't pull it off the heat too early.
More Chinese-inspired Dishes
📖 Recipe
Chilli Paneer Recipe (Restaurant-Style, Dry & Gravy)
Want to save this recipe?
We'll email this post to you, so you can come back to it later!
Video
Equipment
Ingredients
Paneer Marinade
- 14 oz paneer cut in ¾-inch cubes
- 2 tablespoons soy sauce
- 3 tablespoons cornstarch
Stir-Fry
- 3 tablespoons avocado oil or olive oil (used in different stages)
- 1 tablespoon ginger finely chopped (about 1-inch piece)
- 2 teaspoons garlic finely chopped (about 2-3 cloves)
- 5-6 dried red chilies whole
- 1 cup onion cut in 1-inch cubes and layers separated (about 1 medium onion)
- 1 cup bell pepper green or any color, cut in 1-inch pieces
- 2 tablespoons thinly sliced green tops of green onions for garnish
Sauce
- 2 tablespoons dark soy sauce (see notes)
- 1 tablespoon rice vinegar
- 2 tablespoons ketchup
- 1 tablespoon sambal oelek or chili garlic sauce
- ¼ teaspoon ground white pepper
- 1 teaspoon sesame oil
- 1 tablespoon cornstarch
Instructions
- Marinate Paneer: Toss paneer cubes in soy sauce. Now add cornstarch and toss till it forms a thin batter with the soy sauce and coats the paneer pieces well.
- Pan-fry Paneer. Heat a skillet over medium-high heat. Add oil, then spread the paneer in a single layer. Cook for 2 minutes per side, until golden brown. Remove and set aside, then repeat with the remaining paneer.
- Sauté Aromatics. Heat the same skillet, add the remaining tablespoon of avocado oil and add chopped ginger, garlic and dried red chilies. Stir and sauté for 1 minute.
- Sauté veggies. Add the onion and peppers and stir-fry for 4-5 minutes, until the onions start to turn translucent but are still firm. Toss in the browned paneer pieces.
- Prepare Sauce. In a bowl, mix the sauce ingredients until the cornstarch (corn flour) is fully combined. Pour the sauce over paneer, onions, and peppers, and stir until it coats everything evenly and starts to thicken.
- Garnish & Serve. Turn off the heat when it reaches your desired thickness, about 2-3 minutes (see notes about making a dry version or gravy version). Garnish with sliced green onions.
Notes
- Use dark soy sauce for a richer flavor. For umami-packed results, I like to use dark soy sauce. It adds a nice, deep amber color and an intense flavor. If you only have regular soy sauce on hand, add another ½-1 Tablespoon depending on how salty you like your dish.
- Alter the sauce to dry or gravy. This recipe results in a semi-dry dish, popularly known as 'Dry Chilli Paneer' in restaurants. To make more sauce, simply add ½ cup water or broth to the sauce mix and simmer for 2-3 minutes.
- A wonderful vegetarian recipe you can make gluten-free or vegan. Paneer is a great vegetarian adaptation of chili chicken. Simply use tamari instead of soy sauce for a gluten-free version.
- Make this recipe Vegan by substituting paneer with extra-firm Tofu cut in bite-size pieces.
Priya says
delicious!
Aneesha says
Thank you Priya ????????
Araavali Trails Palanpur says
really great work.
Aneesha says
Thank you!
arun sharma says
soo delicious
Aneesha says
Thank you!
Kathy says
I live in a small town where things are sometimes hard to find, So I have learned to do a LOT of substituting. The dry peppers, I have been all over town looking for some, and there are none to be had within a 75 mile radius. I wont order them from amazon, because 1) I will never use the amount I would have to order to make it worth my efforts before they eventually went bad. Even dried foods have a shelf life, as Im sure you know.
2) the shipping charge is almost more then the product. (I dont do a lot of amazon shopping, the prices are considerably higher then what I can get things for locally...usually)
SO my question is this: Can I substitute chili flakes and if so, how much do you think would be a good amount without overdoing it? Or could I just eliminate them all together?
Thank you
Aneesha says
Hi Kathy, I understand. You can substitute them with red pepper flakes- about 1/2-1 teaspoon depending on your spice level preference. And it's totally fine to skip it as well.