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Preheat oven to 350°F. Line 12 (1/2-cup) muffin cups with paper liners.
Bring about 1 inch of water to a boil in a large saucepan fitted with a steamer basket. Add beets, cover and steam until tender, 10 to 12 minutes. Transfer to a blender. Add buttermilk and puree until smooth. Reserve 2 tablespoons of the beet puree. Pour the rest into a large bowl.
Whisk flour, cocoa, baking soda, baking powder and salt in a medium bowl. Whisk egg, oil, 1 cup confectioners’ sugar and vanilla into the beet puree in the large bowl. Stir in the dry ingredients until just combined. Spoon the batter into the prepared muffin cups.
Bake the cupcakes until a toothpick inserted into the center comes out clean, 18 to 20 minutes. Transfer to a wire rack and let cool completely.
To prepare frosting: Combine the remaining 3/4 cup confectioners’ sugar and cream cheese with the reserved beet puree in a medium bowl. Beat with an electric mixer until smooth. Top each cooled cupcake with a generous 1 tablespoon frosting.