Ghee is typically prepared by simmering butter, which is churned from cream (traditionally made by churning the top most layer of curd), skimming any impurities from the surface, then pouring and retaining the clear liquid fat while discarding the solid residue that has settled to the bottom.

Spices can be added for flavor. The texture, color and taste of ghee depend on the quality of the butter, the milk source used in the process and the duration of time spent boiling.