Use high-quality unsalted butter. Cut it into pieces and place it in a saucepan.
Heat the butter over medium heat until it melts completely. Stir occasionally to prevent burning.
Continue to cook the melted butter on low heat. It will begin to bubble and foam.
As the butter simmers, milk solids will separate and sink to the bottom, turning golden.
Cook until the milk solids turn a deep golden brown and the liquid becomes clear.
Pour the clear liquid through a fine mesh strainer or cheesecloth to remove the milk solids.
Allow the ghee to cool to room temperature before transferring it to an airtight container.