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Bring a large pot of lightly salted water to a boil. Add spaetzle and cook for 25 minutes, following package directions.
Meanwhile, combine 1 cup mushrooms, shallots and garlic in a food processor or mini chopper. Pulse to finely chop. Transfer to a large bowl and add ground beef and pork, breadcrumbs, egg, sage, salt and pepper. Mix just until combined. Shape into 32 meatballs, using 2 tablespoons mixture for each.
Heat oil in large, lidded nonstick skillet over medium-high heat. Add meatballs to the pan; it will be a tight fit. Brown meatballs, turning occasionally. Slice the remaining mushrooms and add to the pan with all but 1/4 cup of the beef broth. Cover pan, reduce heat to medium-low and simmer for 15 minutes.
Mix flour into the reserved broth. With a slotted spoon, remove meatballs from pan. Stir flour mixture into pan. Simmer until thickened, about 3 minutes. Drain spaetzle. Transfer to a platter. Stir meatballs back into sauce in skillet, then spoon over spaetzle and serve.