Caramelized Onions and Mushrooms – the single BEST side dish and perfect topping with grilled steak or pan sauteed steak – and they couldn’t be easier to make. I’m walking you through with 4 simple steps.

I make these sauteed mushrooms and onions again and again because they’re easy to make, taste restaurant quality and I can whip up a batch in under 15 minutes.
This is an easy side dish that goes with almost anything – especially steak! – like my 4-ingredient slow cooker applesauce. I guess that’s why they’re two of my favorite recipes.

Why I make this with every steak dinner:
- Versatile side side – the earthy flavor elevates any grilled or pan seared steak to restaurant quality.
- Takes minutes to make, 4 simple steps and a few simple ingredients.
Ingredients needed to make Caramelized Onions and Mushrooms:
- baby bella mushrooms (can also use white mushrooms)
- yellow onion
- olive oil
- butter
- salt and pepper
- Worcestershire sauce
Optional garnish: 2 tablespoons fresh parsley, finely chopped
Best way to clean mushrooms:
There are a couple different way to clean mushrooms and a lot of discussion about whether to wash or just wipe them.
I wipe mine with a damp paper towel or sometimes a pastry brush if there’s a lot of dirt on them.
If you rinse them, be sure to dry them really well. Wet or moist mushrooms will affect the caramelization process – the end game for all the flavor. To rinse them, use the ‘shower’ option on your kitchen faucet to get most of the debris off.
You can also fill a bowl with water and dunk them – just don’t soak them in water – they’ll get spongy.
Either method – dry them well before cooking.
Tips for the best mushrooms and onions:
- Butter – olive oil combination for cooking. Olive oil keeps the butter from browning too quickly. Butter adds rich flavor you can’t get from olive oil.
- Season near the end of cooking with salt and black pepper. The salt draws moisture from the mushrooms if you add it early and makes it harder to caramelize them.
How to make Caramelized Onions and Mushrooms:
- Slice onions 1/4 to 1/2″ thick.
- Heat olive oil and butter in a large skillet. Add mushrooms.
- Cook uncovered until bottoms are brown. Season with salt, pepper and worcestershire.
- Mushrooms and onions are done when they’re golden and onions are tender.

What to serve with these mushrooms:
- Pan Seared Steak
- Grilled Marinated Steak
- Juicy Grilled Burgers
- Juicy Grilled Burgers
- Blend with risotto for elevated flavor.
- Slow Cooker Pot Roast.
- Add thin slices to pizza
- Top baked potatoes
Storage and reheating:
Store leftover mushrooms in an airtight container in the fridge up to 3 days. Reheat in the microwave at 30 second intervals or in a skillet over low heat.
Subs and variations:
- Sub portobello, morel mushrooms or oyster mushrooms in this recipe.
- Use different kinds of onions – any sliced onions work – red onions, vidalia, sweet onions
- Sub soy sauce or balsamic vinegar for Worcestershire sauce.
- Add fresh herbs – thyme, rosemary and parsley – or minced garlic.
- Pour in a splash of dry red or white wine.
Enjoy!

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Caramelized Onions and Mushrooms
Equipment
- large skillet
Ingredients
- 8 ounces baby bella mushrooms sliced 1/4-1/2" thick (can sub white mushrooms)
- 1 medium onion thinly sliced
- 1 1/2 tablespoons olive oil
- 1 1/2 tablespoons butter
- 1/2 teaspoon salt or to taste
- 1/4 teaspoon pepper or to taste
- 1 tablespoon Worcestershire sauce
Optional Garnish:
- 2 tablespoons fresh parsley finely chopped
Instructions
Cleaning the Mushrooms:
- Whatever method you use to clean the mushrooms, it’s very important to dry them well. Wet or moist mushrooms will affect the caramelization process.
- If your kitchen faucet has a ‘shower’ option lightly spray the debris from the mushrooms OR fill a large bowl with room temp water and plunge them quickly, turning to remove the dirt.
- Transfer them to a clean cotton towel and dry them well before cooking.
Cooking Onions and Mushrooms:
- Peel and thinly slice the onion then once the mushrooms are clean and dried well, slice the mushrooms 1/4 to 1/2″ thick (or thicker if you prefer).
- To a large skillet over medium – medium-high heat add the olive oil and butter. Once the butter melts, swirl it around the bottom then add the mushrooms in as much of a single layer as your skillet will allow.
- Scatter the onions over the top of the mushrooms.
- Let the mushrooms saute (uncovered) without stirring for 3-4 minutes. This is the hardest part because the tendency is to stir.
- Check them and once the bottoms are golden brown, season with salt and pepper, add the Worcestershire sauce and give it all a good stir.
- Reduce to medium low/low heat and continue cooking 3-5 minutes more, stirring occasionally until the mushrooms reach your preferred color and the onions are tender.
- Taste and adjust salt as needed then serve right away.