Butterscotch Marshmallow Squares – Easy No-Bake Bars With Peanut Butter

This recipe for Butterscotch Marshmallow Squares brings together the chew of marshmallow bars, the sweetness of butterscotch chips, and the rich saltiness of peanut butter into one of the easiest no-bake desserts you’ll ever make.

You’ll learn how to layer a crisp graham cracker crust beneath soft pastel marshmallows folded into a silky butterscotch-peanut butter mixture. If you’ve ever searched for peanut butter marshmallow squares, butterscotch marshmallow bars, or a marshmallow bars recipe that delivers nostalgia with every bite, this is the one that stays with you.

You can serve these bars chilled, slice them cleanly into squares, or even freeze them for events later in the week. They’re sturdy enough for bake sales, sweet enough for kids’ birthdays, and quick enough for a last-minute treat. I’ve written this version based on the one I’ve relied on for years. My notes are peanut-butter smudged, but the result is always clear: these bars disappear fast.

---

Why Butterscotch Chips and Marshmallows Just Work

Pastel mini marshmallows bring a soft chew and color contrast to the warm, creamy mix of butterscotch and peanut butter. These aren’t just peanut butter squares. They’re a nod to vintage potluck desserts, when pantry ingredients made crowd-pleasers.

You’ll use one bag of butterscotch chips and fold in colorful marshmallows once the base has cooled. That step matters. If you mix them in while the butterscotch is too hot, you’ll end up with a sticky mess instead of clearly shaped pastel pieces. This technique keeps the colors distinct and the texture soft.

I often get asked if these are the same as peanut butter marshmallow bars. They’re close cousins. But the graham cracker base gives them a structure that makes slicing and serving much easier. Think of them as a cleaner, crunchier version of traditional butterscotch peanut butter marshmallows.

---

Making the Base: Graham Cracker vs. Cereal Crust

I’ve tested both graham crackers and crispy rice cereal as the base for these marshmallow bars. The cereal version offers an airy bite, but the graham cracker crust wins for flavor and structure. It holds firm when chilled and gives that caramelized crunch beneath the soft, chewy topping.

To make it, you’ll blend graham crumbs with sugar and melted butter, then press it into a parchment-lined pan. I chill it in the freezer while preparing the topping. That step sets the crust enough to hold the marshmallow mixture without softening.

If you’re looking for other no-bake bars with peanut butter, try my Peanut Butter Rice Krispie Treats for something lighter.

---

Melting the Butterscotch and Peanut Butter Mixture

Use low heat and stir constantly. Butterscotch chips burn quickly if left unattended. I add the butter and peanut butter directly to the saucepan along with the chips. The mixture should turn glossy and smooth. Once melted, take it off the heat and give it several minutes to cool.

This short pause makes all the difference. Marshmallows added too early will melt into the mix instead of staying whole. That might still taste good, but you’ll lose the distinct texture of the marshmallow bars. Waiting five to seven minutes gets the temperature just right.

If you enjoy that blend of butterscotch and peanut butter in other forms, my Butterscotch Crunch Cake Recipe takes a similar flavor and builds it into layers.

---

Folding Marshmallows Without Breaking Them

This part feels more like candy making than baking. You’ll gently fold the pastel mini marshmallows into the cooled butterscotch mixture. Take your time. Use a soft spatula and move the mixture slowly to avoid breaking the marshmallows or smashing the color.

The pastel colors hold best when the mixture is just barely warm. Once coated, pour them evenly over the cold graham crust and gently press down. I use a second piece of parchment and a flat-bottomed glass to tap the mixture into place.

---

Chilling and Cutting Butterscotch Marshmallow Bars

Refrigerate the tray for at least two hours. Don’t rush this. It’s tempting to slice early, but the bars cut best when completely cold. I run a knife under hot water, dry it off, and slice firmly through the set topping.

The texture contrast between the crisp base and chewy top comes through best when cold. These marshmallow bars also hold their shape better than many Peanut Butter Marshmallow Squares, thanks to that structured base.

---

Serving Tips and Storage Advice

Store these bars in the refrigerator in a sealed container. They last for up to five days chilled. If you need to make them ahead, they freeze well too. I wrap them tightly and thaw them in the fridge overnight.

I often serve them sliced small on a platter alongside other no-bake sweets. The soft color of the marshmallows makes them stand out, especially on white ceramic or glass. You can even drizzle extra melted butterscotch on top for added shine.

---

Save and Share This Classic

If these Butterscotch Marshmallow Squares remind you of something your aunt made or a treat from a childhood bake sale, you’re not alone. They’ve lasted decades for a reason.

Save this recipe to your Pinterest boards so you can come back to it anytime. And if you try it, let me know how it turned out in the comments. I’d love to hear how you’ve made it yours.

---