I looked to see if there was another thread on this, but no luck. I may have missed it. And many may know how to do it already, but I thought I would go ahead and post this anyway.

I have become the ghee-making monster. It is as easy as easy gets.

Take a saucepan and put cut up pieces of unsalted butter in it. The small pieces melt quicker. Turn on a low flame and let the butter melt slowly. I keep stirring gently to keep anything from burning on the bottom of the pot.

Once the butter is melted keep it on a low flame and keep stirring gently. Soon a foam will form on the top. This is one of the milk solids and water rising. Don't bother skimming it, as that's extra work for you.

The foam will dissipate leaving the lighter milk solids. You can begin skimming them off, but don't throw it out. Keep stirring to bring more water out. The milk solids will begin to settle out and form little clumps. Keep stirring so as not to let them fall to the bottom and burn.

After a time, this whole process takes about 30 minutes, the pure butterfat will become transluscent, with the rest of the milk solids settling to the bottom. Once the butter fat is perfectly transluscent, you can turn off the heat, let the solids settle and now filter it.

I use a fine mesh strainer lined with a paper coffee filter, over a bowl or jar. Carefully pour the liquified ghee into the strainer. Keep the milk solids from earlier, and what's left in the pot. Use it like you'd use regular butter. One lb of butter will yield maybe 1 1/2 cup of ghee.

The ghee should look like (sorry to use a non-veg term) crystal clear chicken stock. As it cools it will become like cake frosting in texture. I keep it in a glass jar on the counter. If you refrigerate it, it will get as hard as a rock and take longer to melt. Unrefrigerated it can last a few months, refrigerated it can last a year. But it's extremely important not to get any moisture or other contaminents in the container, as that will cause the ghee to spoil.

I now use it for cooking, panchamrita, on toast, not to mention altar lamps. The stuff is wonderful.