Cube the butter and place into a light coloured frying pan over a medium high heat. Watch as it melts and then foams. Stir a few times until you can see the milk solids caramelising. There is a fine point here where you want to brown the butter sufficiently to have the flavour without any burnt bits. It is a fine line. This is the reason you should use a light coloured pan as it enables you to see the colouring of the butter more easily.
When it has reached nut brown colour, remove from the heat and scrape all of the butter and the caramelised solids into a container either to keep or use immediately.