In a deep saucepan, melt butter on medium heat. The melted butter will start turning frothy pretty quickly.
Give it a quick stir and continue to cook. Eventually the froth will slowly disappear leaving behind a deep brown liquid.
Reduce the heat to medium-low. Milk solids will turn deep brown and will start moving towards the bottom of the pan and you will be left behind with a clear liquid.
Take it off the heat and let it cool for 5 minutes before pouring into a glass jar. Apply the lid only after the ghee has completely cooled down.
Store it in room temperature for a month or refrigerate it for it to last longer.