Are you tired of spending hard earned money for a steak dinner at the restaurants? With this Caramelized Onion Butter Steak recipe you won’t even be thinking about going out to eat. All the work is put in upfront to make the compound butter and then the fun part takes place, grilling up the steaks. 

This butter will go great on Filet Mignon, ribeye steaks, NY Strip or even used to add some extra flavor on some roasted potatoes. I have even used it as a spread on the buns of my burgers, to be honest, you can’t go wrong putting it on anything! perfect medium rare steaks

The best way to use it is by mixing up all of the ingredients and then rolling it into a butter log with saran wrap or parchment paper. This will keep it from spoiling early and allow you to manage the butter with the size of the slices. I like to use one tablespoon per steak, that is a hefty tablespoon! 


camelizing onions in a cast iron skillet

Once you learn how to caramelize onions you won’t want to make them any other way. When done properly it will bring out a deep, rich, sweet flavor because the natural sugars within the onion will caramelize. 

To caramelize onions they need to be cooked at a low temperature very slowly in olive oil until they are a deep brown color. At this point, you have the liberty to add other ingredients to build more depths of flavors. Let’s dive into the process.

Start off by slicing a white onion into thin slices, I typically do two of them per batch. Get a skillet over medium low heat and add a tablespoon of olive oil and a tablespoon of unsalted butter, melt it down and mix it together and add the onions (I like to add a pinch of salt). From here, stir the onions every few minutes so they don’t burn on one side. This will take about 45 minutes and they will start to turn a deep brown color and begin to turn into a paste. 

At this point I like to add some extra ingredients to elevate the depth of the flavors. I add a splash of Worcestershire sauce, a splash of Balsamic Glaze and a tad bit of bourbon. Let this cook down for another 15 minutes and it will be a mushy dark brown paste, which is exactly what you are looking for. Remove them and place in a bowl for the compound butter.


To make this compound butter all that is needed is a block of softened butter, unsalted (I like to use Kerry gold). Place this in a food processor with the caramelized onions that were just made, a tablespoon of garlic paste, two teaspoons white wine vinegar, one teaspoon red pepper flakes and 3 tablespoons of roasted bone marrow for a nice kick of umami. 

Once all of these ingredients are in the food processor it is time to party and let it run for about one minute. The key is to make sure it has a nice smooth consistency. At this time, get a 10×8 inch sheet of saran wrap and place the butter in a horizontal uniform log shape. Roll it up and twist the ends, place it in the fridge for 45 minutes before using and it should last you about 10 days.compound butter on a steak


compund butter in a bowl

Caramelized Onion Butter Steaks

Prep Time 25 minutes
Cook Time 1 hour 30 minutes
Total Time 1 hour 55 minutes
Course Main Course
Cuisine American
Servings 6


  • 3-4 NY Strip steaks
  • Olive oil as a binder
  • 1 tablespoon each salt pepper and garlic powder (or favorite steak rub)

Caramelized Onions

  • 2 white onions sliced
  • 1 tablespoon olive oil
  • 1 tablespoon butter unsalted
  • 2 teaspoons Worcestershire sauce
  • 2 teaspoons bourbon
  • 1 teaspoon balsamic glaze

Compound Butter

  • 1 block softened butter unsalted
  • 1 tablespoon garlic paste
  • 1 tablespoon white wine vinegar
  • 1 teaspoon red pepper flakes
  • 1/3 cup caramelized onions
  • 3 tablespoons roasted bone marrow


  • Start off by roasting the bone marrow over direct heat, this should only take about 8-10 minutes. A good way to know is by checking the inside, it will bubble. Wrap in foil and save.
  • Apply olive oil on the steaks and season them with your favorite steak rub, let them sit while you make the caramelized onions.
  • Place a cast iron skillet over low heat and add olive oil and butter. Once it's melted together add the onions with a pinch of salt. Stir every few minutes and repeat this for about 40 minutes, the onions will begin to turn a deep rich brown. At this point, add the Worcestershire sauce, balsamic glaze and bourbon. Let it cook slowly for another 10-15 minutes and stir every minute or two. Remove and place in a bowl.
  • In a food processor add a block of butter, unsalted, the caramelized onions, roasted bone marrow, garlic paste, red pepper flakes and white wine vinegar. Run the processor for a minute, or until it’s consistently blended and wrapped in saran wrap. Place it in the fridge for 45 minutes.
  • Add the steaks over direct heat for searing, 60-90 seconds per side, and then transfer them to the indirect side. When the steaks reach 118 degrees F internally add a tablespoon of the Caramelized Onion Butter. Let the steaks finish and remove.
  • Let the steaks rest for 8-10 minutes and then slice. Serve with your favorite sides and enjoy!
Keyword carmelized onion butter, compound butter for steak, easy compund butter for steak, Onion butter, onion butter steaks

This Caramelized Onion Butter Steak recipe is a game changer for anyone who loves a good steak dinner. Not only is it a cost-effective alternative to dining out, but it also allows you to customize your steak to your liking. The compound butter, made with caramelized onions, roasted bone marrow, and other delicious ingredients, adds a rich, savory flavor to any cut of meat. And the best part? You can use it on just about anything, from roasted potatoes to burgers.perfect sear on an onion butter steak

Learning how to properly caramelize onions is a skill worth mastering, as it brings out a deep, sweet flavor that can’t be achieved by simply cooking them in high heat. Slowly cooking the onions in a mixture of olive oil and butter for 45 minutes until they turn into a paste is the key to achieving that rich flavor. Adding a few extra ingredients like Worcestershire sauce, balsamic glaze, and bourbon only enhances the depth of flavors.

The process of making the compound butter is easy, and the result is a an awesome, creamy butter that can be kept in the fridge for up to 10 days. Mixing the softened butter with the caramelized onions, roasted bone marrow, garlic paste, white wine vinegar, and red pepper flakes in a food processor for a minute or until it has a smooth consistency is all it takes to create this mouth-watering butter.stacked steaks on a cutting board

Overall, this recipe is a great way to impress your guests or treat yourself to a delicious steak dinner without breaking the bank. With a little bit of patience and some simple ingredients, you can create a steak that rivals any restaurant’s. So fire up the grill, make some compound butter, and get ready to enjoy a steak dinner like no other.



Items used in This Recipe

PK Grill

Knitted Gloves

Food Processor

Cast Iron Skillet 

Meater +

Charcoal Chimney

Charcoal Starters

Firestarter Guard

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