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Preheat oven to 400 degrees F (204 C) and prepare a baking sheet by spraying it with avocado oil (for the crispiest nuggets) or lining with parchment paper.
If you haven’t already pressed your tofu, do so at this time by using a tofu press, or wrap in a clean, absorbent towel and set something heavy — like a cast iron skillet or books — on top to press out the moisture. Press for about 15-20 minutes.
While your tofu drains, prepare the cashew coating. In the bowl of a food processor, combine the cashews, cornstarch, nutritional yeast, salt and pepper, smoked paprika, and garlic powder. Pulse a few times to break down the cashews slightly, then turn the processor on until you achieve a fine meal (see photo), about 30-45 seconds. Transfer the cashew coating to a shallow bowl or dish.
Next, make the vegan buttermilk in a separate shallow bowl or dish by combining the dairy-free milk and lemon juice. Mix and set aside to curdle. Then add 1/2 cup cornstarch (56 g) to another shallow bowl and set aside (adjust the amount of cornstarch if altering the default number of servings).
Cut your pressed tofu into 1-inch (2 ½ cm) cubes, and start the assembly line! Using clean hands, start by coating your tofu in cornstarch and gently tapping on the side of the bowl to shake off any excess. Next, dip in the vegan buttermilk and evenly coat, then place in the cashew coating and turn the tofu a few times to evenly coat all sides. Place your breaded nugget on the prepared baking sheet and repeat with the remaining tofu.
Bake for 30 minutes, flipping halfway through, until the tofu nuggets are slightly golden, dry, and bouncy to the touch. Let cool slightly before serving with your favorite sauce — we love them with tartar sauce, ketchup, "honey" mustard, ranch, or BBQ sauce. If serving to kids, it’s best to slice the nuggets in half to help the insides cool off.
Leftovers keep in the refrigerator for 2-3 days or in the freezer for up to 1 month. For best texture, reheat in a 400 F (204 C) oven for 5-10 minutes or until warmed through.