In a heavy skillet, over medium to medium low heat, heat butter until completely melted. Watch as butter boils, first with large bubbles and white milk solids floating on the surface, then with only a fine white foam filling entire surface. Stir occasionally.
Soon small patches of golden brown will appear on the surface, and overall color of butter will change from yellow to golden. Push aside foam periodically to check color of sediment. When sediment turns light brown, remove from heat (see note).
Decant into a jar with a tight lid. Warm, if desired, for serving over rice.
Note: If you heat until sediment turns dark brown, ghee will lose its flavor and taste like vegetable oil.