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Aerial shot of chilli paneer in a white ceramic serving bowl on a black background.
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5 from 5 votes

Restaurant Style Chilli Paneer Recipe

Chilli Paneer is an Indian-Chinese Style main course dish of paneer (cottage) and veggies in a sweet, spicy, and salty sauce. Learn how to make restaurant style chilli paneer in few simple steps. 
Prep Time30 mins
Cook Time15 mins
Total Time45 mins
Course: Main Course
Cuisine: Indian
Servings: 4 adults
Calories: 329kcal
Author: Hina Gujral


  • 200 gram paneer (cottage cheese), cut into cubes
  • 1 Cup diced onion
  • 1 Cup diced capsicum
  • 1 tablespoon finely chopped ginger
  • 1 tablespoon finely chopped garlic
  • 1 tablespoon white vinegar
  • 1 tablespoon soy sauce
  • 4 tablespoon cooking oil
  • 2 tablespoon chopped spring onion
  • Salt to taste
  • 1 tablespoon cornflour (corn starch)
  • 1 Cup water

Ingredients For Sauce:

  • 4 dry red chilli (sabut lal mirch)
  • 1 inch piece of ginger
  • 1 tablespoon garlic cloves
  • 1 tablespoon chopped onion
  • ¼ Cup hot water
  • 2 tablespoon tomato ketchup

Ingredients for the marinade

  • 4 tablespoon corn flour (cornstarch)
  • 1 tablespoon all-purpose flour (maida)
  • 1 teaspoon soy sauce
  • Salt and black pepper to taste


Prep Work:

  • Soak paneer block in lukewarm water for 5 - 6 minutes. Later, cut into cubes. Marinate the paneer cubes in corn flour, all-purpose flour, salt, pepper, and soy sauce. Mix nicely to coat each paneer cube with the flour mixture. Add a tablespoon of water if the marinade is too thick. Set aside.
  • Prepare my secret sauce. Soak dry red chili in hot water. Cover and set aside for 5 - 6 minutes for chilies to soften a bit. Later, blend the chilies along with soaked water, ginger, garlic, onion, and tomato ketchup to a smooth sauce. Set aside.
  • Make a paste of cornflour and water. Mix nicely to make a lump free mixture. Set it aside till required.

Prepare Chilli Paneer:

  • Heat oil in a deep frying pan. Shallow fry the marinated paneer cubes until light golden in color and crisp from both sides. Do not turn the paneer cubes again and again while frying. Transfer to a plate and set aside.
  • In the same pan add ginger and garlic. Stir fry for a minute. Add onion, and stir-fry over a high flame for 1 - 2 minutes or till onion soften a bit.
  • Add the capsicum and sauté for a minute or so.
  • Next add vinegar, soy sauce, chili sauce, salt, and mix nicely.
  • Now, add the cornflour paste and stir the sauce continuously to avoid any lump formation.
  • The sauce will start thickening now. Taste and adjust the seasoning accordingly
  • Once the sauce thickens, add fried paneer cubes. Stir to combine. Allow the sauce to simmer over low heat for 5 - 6 minutes for paneer to absorb the flavor.
  • Garnish the chilli paneer with chopped spring onion greens.
  • Serve Chilli Paneer with fried rice.



  • Recommended Equipment: Wok ( buy it here )
  • Do not deep-fry the marinated paneer cubes as they become chewy and hard. 
  • You can prepare my secret chili sauce in advance and store in the fridge. Or the leftover sauce can also be stored in the fridge. 
  • The chili sauce is spicy. Hence, taste it and then add to the gravy accordingly. We love spicy food so add the entire cup. 
  • To adjust the consistency of the gravy add more water if required. 


Calories: 329kcal | Carbohydrates: 14g | Protein: 9g | Fat: 27g | Saturated Fat: 9g | Polyunsaturated Fat: 4g | Monounsaturated Fat: 9g | Trans Fat: 1g | Cholesterol: 33mg | Sodium: 424mg | Potassium: 196mg | Fiber: 2g | Sugar: 5g | Vitamin A: 178IU | Vitamin C: 35mg | Calcium: 266mg | Iron: 1mg