usually hard candy made by boiling brown sugar and butter or corn syrup together in water. The derivation of the name is disputed as to whether it denotes the candy's origin in Scotland or an original ingredient of “scotched,” or scorched, butter. Although the terms butterscotch and caramel are sometimes used interchangeably, butterscotch is generally distinguished by the absence of milk or milk substitutes from its recipe.

Butterscotch in its hard form is typically marketed as translucent, rich yellow drops or disks individually wrapped in cellophane. Butterscotch chips, analogous to chocolate chips, are packaged and sold primarily for use in dessert cooking. In the home kitchen, the making of butterscotch is usually an initial step in the preparation of some more complicated, elegant dessert. The brown sugar and butter formula is basic to a variety of cookies, puddings, icings, fudges, and sauces.