Easy Caramelized Onions and Mushrooms

Caramelized onions and mushrooms cook low and slow for a rich, melt-in-your-mouth result. This easy recipe upgrades any steak or sandwich, or enjoy it on its own as an easy side dish!

Caramelized onions and mushrooms in a small white bowl.

Why this recipe works

Caramelized onions are a staple flavor powerhouse in any kitchen, and adding mushrooms can create an exciting topping for anything from steak to sandwiches to even breakfast foods.

By sautéeing and browning the mushrooms first and then adding the onions, you can cook each ingredient to their maximum flavor potential while keeping everything in a single pan.

We’ll sauté the mushrooms at a higher heat for better browning in a mixture of butter for flavor and oil for its higher smoke point. Then, we reduce the heat and add the onions, cooking at medium low heat until they’re brown, sweet and jammy.

Ingredients for making caramelized onions and mushrooms.

Ingredients

With just a few simple ingredients and a bit of time, you can have a delicious side dish that takes steaks and sandwiches to the next level! Here’s what you’ll need:

  • Mushrooms: Cremini mushrooms (or Baby Bella mushrooms) are my first choice for their firm texture and earthy flavor, followed by white mushrooms (or button mushrooms).
  • Onions: I used two medium yellow onions for 8 oz. of mushrooms. It looks like a lot but they shrink down so much it ends up being a good balance.
  • Butter: Best for adding flavor to your onions and mushrooms.
  • Olive oil: I use this while browning the mushrooms since they cook at a higher heat.
  • Kosher salt: Beware of adding too much too soon. Since everything shrinks down so much during the long cooking process, you don’t want to end up with over-salted onions.
  • Sugar (optional): Half a teaspoon to a teaspoon of sugar can further enhance the caramelized flavor of the onions.
  • Water, white wine, broth, or balsamic vinegar: You’ll want some liquid to deglaze the pan at the end. I just used a little water but depending on how you plan to use the mushrooms and onions you may choose a different liquid. For example, balsamic caramelized onions are great on this fig, bacon, and blue cheese pizza.

What kind of onions should I use?

​You can caramelize any type of onion, but here are my top choices.

  • Yellow onions: The go-to onion for caramelizing. Use for a balanced sweet-savory flavor.
  • Sweet onions (like Vidalia): Use these for an extra-sweet flavor. 
  • Red onions: These also have a higher sugar content and will give a darker color. I love them in my caramelized red onion and blueberry jam.
Caramelized onions and mushrooms in a small white bowl next to a small fork.

How to Make Caramelized Onions & Mushrooms

While caramelizing onions takes a while, it’s really a simple recipe that takes more time than effort.

Brown the mushrooms first. I love nice, golden brown edges on my mushrooms, and that requires medium-high heat. We’ll start off this recipe by melting butter with olive oil in a large skillet, sauté pan, or Dutch oven. Cook the mushrooms for two minutes per side, undisturbed.

Then, caramelize the onions. You don’t need to remove the sauteed mushrooms when you add the onions; they really won’t overcook. The caramelization process for the onions requires medium-low heat and takes quite a while.

Expect to be babysitting these bad boys every 5 minutes or so for 30-45 minutes, until the onions are a golden brown color with a jammy texture. It’s fairly hands-off and the results are totally worth it.

If the mixture starts looking dry: Add a splash of water or another half a tablespoon of butter. You don’t want to burn your onions!

At the end of cooking: Deglaze the pan with a splash of water, white wine, or even balsamic vinegar. Be sure to scrape up any fond that has formed on the bottom of the pan — that’s extra flavor right there!

Tips & Tricks

  • Slice your onions lengthwise. Sliced onion cut lengthwise is more evenly sized and holds its shape better when caramelizing. To do so, quarter the onion from root to end. Peel off any papery skin and cut out the core. Then cut into lengthwise thin slices about 1/4-inch wide. Onion that’s sliced too thin may burn more easily. 
  • Buy your mushrooms whole. Especially if you don’t plan to make these right away, buy whole mushrooms and slice them at home. They will last longer and the sliced mushrooms will be much fresher.
  • Add some flavor. Sautéed mushrooms and caramelized onions have tons of flavor as is, but you can add extra flavor with fresh herbs, garlic, or liquid. Fresh thyme or minced garlic complement caramelized onions and mushrooms beautifully (add with the onions). Or, deglaze your pan with broth, wine, balsamic vinegar, or soy sauce. You can also add a little Worcestershire sauce, especially if you’re using this as a topping for a steak dinner!
  • Use the right pan. My top choices for caramelizing are a large sauté pan or an enameled cast iron skillet or Dutch oven. Non-stick pans won’t allow fond to develop that adds that luscious bonus flavor. Whatever kind of pan you use, make sure it has a large surface area. A deeper saucepan will trap excess liquid and steam your onions instead of caramelizing them. For the same reason, make sure you cook your onions uncovered.
  • Freeze for later. Both sautéed mushrooms and caramelized onions freeze well. Make a double batch and freeze in ice cube trays so you can easily grab a couple portions as needed without having to spend another hour cooking! You will have to sauté the mushrooms in two batches so they don’t overcrowd and steam.

Serving suggestions

Caramelized onions and mushrooms are a super versatile side dish! They are a perfect topping for meats and sandwiches, or can be enjoyed on their own. Here are a few ways to use them:

  • On ribeye steaks or pork chops
  • On a steak sandwich
  • On a burger
  • As a topping in grain bowls
  • As a base for French onion soup with mushrooms
  • Mixed into an omelet or fritatta

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Caramelized onions and mushrooms in a small white bowl.
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Caramelized Onions and Mushrooms Recipe

Caramelized onions and mushrooms cook low and slow for a rich, melt-in-your-mouth result. This easy recipe upgrades any steak or sandwich, or enjoy it on its own as an easy side dish!
Print Recipe Save Recipe
Course: Condiment, Side Dish
Cuisine: American
Yield: 4
Calories: 143kcal
Prep Time:5 minutes
Cook Time:45 minutes
Total Time:50 minutes

Ingredients

  • 1 tablespoon olive oil
  • 3 tablespoons butter divided
  • 8 oz. sliced mushrooms cremini or baby bella
  • 2 medium yellow onions
  • 1/2 teaspoon kosher salt more to taste
  • 1/2 teaspoon granulated sugar optional

Instructions

  • Prepare onions. Cut in half from root to end and peel off papery skin. Quarter and remove the core. Then slice in strips about 1/4" wide from root to end.
  • Preheat a sauté pan over medium high heat. Add olive oil and 1 tablespoon of butter until the butter is melted.
  • Add mushrooms in a single layer and sprinkle with salt. Cook for 2 minutes, then flip and cook an additional 2 minutes to get some brown on the edges of the mushrooms.
  • Lower the heat to medium low and add remaining butter and onions. Cook uncovered for about 45 minutes, stirring every 5 minutes or so, until onions are floppy, translucent, and caramel colored. Add a little butter or a small splash of water if the mixture starts looking dry or sticking, and lower the heat if necessary.
  • Deglaze with about 1/4 to 1/3 cup of water, scraping up any fond that has formed on the bottom of your pan. Add salt to taste and, if desired, a little sugar to bump up the sweetness a bit.
  • Enjoy with steak, on a sandwich or burger, or as a side dish. Store refrigerated in an airtight container for up to 4 days, or freeze in ice cube trays for up to 4 months for best flavor.
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Nutrition

Calories: 143kcal | Carbohydrates: 7g | Protein: 2g | Fat: 12g | Saturated Fat: 6g | Polyunsaturated Fat: 1g | Monounsaturated Fat: 5g | Trans Fat: 0.3g | Cholesterol: 23mg | Sodium: 363mg | Potassium: 263mg | Fiber: 2g | Sugar: 4g | Vitamin A: 263IU | Vitamin C: 5mg | Calcium: 17mg | Iron: 0.4mg

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