8 cups (half gallon) whole or 2% milk
1/4 teaspoon table salt
1/4 cup distilled white vinegar (or lemon juice if don't have vinegar)
Line colander with 1 gal paint strainer bag (or four layers of cheesecloth or 2 layers of food-safe paper towels) and set over large bowl.
Stove top: Pour the milk into the saucepan and set over medium heat. Bring the milk to a bare simmer — just below the boil at around 200°F. Stir the milk occasionally, scraping the bottom of the pot to make sure the milk doesn't scald. When ready, the milk will look foamy and steamy.
Add the lemon juice: Remove the milk from heat and stir in the lemon juice. The milk should begin to curdle immediately, but it's ok if it doesn't.
Let the milk stand for 10 minutes: Cover the milk and let stand for 10 minutes to give the acid time to completely separate the curds and whey. At the end of 10 minutes, the curds should be completely separated and the liquid should look yellow and watery. If the milk hasn't separated, try adding another tablespoon of acid.
Microwave: Combine milk, salt, and vinegar or lemon juice in microwave-safe glass 1-quart liquid measure. Microwave on high heat until lightly bubbling around edges, 2 to 4 minutes (milk should register about 165°F on an instant-read thermometer). Remove from microwave, and stir gently for 5 seconds. Milk should separate into solid white curds and translucent liquid whey. If not, microwave for 30 seconds longer. Repeat until fully separated.
Using slotted spoon or wire skimmer, transfer curds to prepared colander, cover exposed top with plastic wrap, and allow to drain until desired texture is reached or squeeze in cheese cloth to drain faster.
For paneer, transfer the curds (still in the cheesecloth) to a large dinner plate. Shape them into a rough square and then fold the cheesecloth tightly around the curds to form a neat rectangular package. Set a second plate on top of the package and weigh it down. Press for at least 15 minutes or up to 1 hour.
Paneer will be firmer if refrigerated before using or possibly pan fry first before adding to meal towards the end of cooking.
Store in covered container in refrigerator for up to 5 days.