Outback Steakhouse Potato Soup is a warm and creamy dish that’s packed with tender chunks of potato, melted cheese, crispy bacon, and a little kick from green onions. It’s the kind of soup that feels like a big cozy hug in a bowl, perfect for chilly days when you just want something comforting and hearty.
I love this soup because it’s simple but so satisfying. The combination of creamy potatoes and salty bacon always hits the spot for me, especially when I make it at home. A little tip: stirring in some extra cheese right before serving makes it even more delicious. I also like to sprinkle a bit of fresh green onion on top to add a bright, fresh touch that balances all the richness.
For serving, I usually pair this soup with warm, crusty bread or even some buttery crackers. It’s great on its own for a light meal or as a tasty starter before dinner. Every time I make this soup, it reminds me of those casual dinners with family and friends where everyone just relaxes and enjoys good food together. It’s definitely a recipe I keep coming back to again and again.
Key Ingredients & Substitutions
Potatoes: Yukon Gold or Russet potatoes work best. Yukon Gold gives a creamier texture, while Russets hold their shape well. If you want a twist, red potatoes are a nice option but they’re a bit waxier.
Bacon: Bacon adds smoky flavor and crunch. Turkey bacon works if you want a leaner choice, though the soup won’t be as rich. You can also skip it for a vegetarian version and add smoked paprika for depth.
Cheese: Sharp cheddar gives great tang and meltiness. If cheddar isn’t your favorite, try Colby or Monterey Jack for a milder taste. Vegan cheese can work but won’t melt quite the same.
Milk & Cream: Whole milk and heavy cream make it beautifully creamy. For lighter soup, try half-and-half, or use plant-based milk but skip cream to keep the thickness.
How Can You Get the Creamy Texture Without Making It Too Thick or Lumpy?
The key is in the roux and blending:
- Cook the butter, onions, and celery nicely before adding flour; this builds flavor and helps thicken evenly.
- Add flour slowly and stir constantly to avoid lumps.
- Whisk in chicken broth gradually to keep the mix smooth.
- Use an immersion blender to partially blend the soup. Leave some potato chunks for texture — it feels homemade and comforting.
- Add milk and cream after blending and heat gently. Do not boil or the dairy might curdle.
- Last, stir in cheese off the heat so it melts smoothly without clumping.

Equipment You’ll Need
- Large soup pot – I like a big pot to cook everything evenly and make it easy to stir.
- Immersion blender – it helps blend the soup to your desired smoothness without transferring to another container.
- Knife and cutting board – for chopping potatoes, onions, celery, and bacon.
- Measuring cups and spoons – keep your ingredients just right.
- Stirring spoon or spatula – for mixing and scraping the pot comfortably.
Flavor Variations & Add-Ins
- Swap bacon for cooked sausage or ham for a different smoky, meaty flavor.
- Try Monterey Jack or Colby cheese instead of cheddar for a milder taste.
- Add sautéed mushrooms or corn for extra texture and flavor.
- Spice it up with a dash of smoked paprika or cayenne pepper for some heat.
How to Make Outback Steakhouse Potato Soup
Ingredients You’ll Need:
Main Ingredients:
- 4 cups peeled and diced potatoes (Yukon Gold or Russet)
- 6 slices bacon
- 1/2 cup chopped yellow onion
- 1/4 cup chopped celery
- 3 tablespoons butter
- 1/4 cup all-purpose flour
- 4 cups chicken broth
- 2 cups whole milk
- 1 cup heavy cream
- 1 teaspoon salt (adjust to taste)
- 1/2 teaspoon black pepper
- 2 cups shredded sharp cheddar cheese, plus more for topping
- 3 green onions, sliced (for garnish)
- Sour cream (for garnish)
How Much Time Will You Need?
This recipe takes about 10 minutes to prep and 30 minutes to cook, for a total of around 40 minutes. That includes cooking the bacon, simmering the potatoes until tender, and finishing the creamy cheesy soup.
Step-by-Step Instructions:
1. Cook the Bacon:
Start by cooking the bacon in a large pot over medium heat until it’s crispy. Once done, take the bacon out, crumble it, and set it aside for later. Leave about 2 tablespoons of bacon fat in the pot; that’ll add great flavor to your soup!
2. Sauté the Vegetables:
Add butter to the bacon fat in the pot and melt it. Toss in the chopped onions and celery, then cook them for about 5 minutes until they become soft and tender. This gives your soup a nice base of flavor.
3. Make the Roux:
Sprinkle the flour over the veggies and stir well. Keep stirring constantly for about 2 minutes. This step makes a roux, which helps thicken the soup later.
4. Add Broth and Potatoes:
Slowly whisk in the chicken broth so the mixture stays smooth and lump-free. Add the diced potatoes. Turn the heat up to get it boiling, then reduce it to low and let everything simmer uncovered for 15 to 20 minutes, until the potatoes are nice and tender.
5. Blend the Soup:
Use an immersion blender to partly blend the soup until you get the texture you like. Leaving some chunks adds a comforting homemade feel.
6. Add Dairy and Cheese:
Stir in the milk and heavy cream, warming gently without letting it boil. Add salt, pepper, and shredded cheddar cheese. Stir until the cheese melts and your soup becomes creamy and smooth.
7. Final Touches and Serving:
Taste the soup and add more seasoning if you want. Serve it hot, topping each bowl with the crumbled bacon, extra cheddar cheese, a spoonful of sour cream, and sliced green onions for that fresh, tasty finish.
Can I Use Frozen Potatoes for This Soup?
Yes, you can use frozen diced potatoes, but be sure to thaw them fully and pat dry to avoid excess water in the soup. Adjust cooking time as needed since frozen potatoes may cook a bit faster.
Can I Make This Soup Ahead of Time?
Absolutely! Prepare the soup up to the blending step, then cool and refrigerate. Reheat gently on the stove, add the dairy and cheese last to keep it creamy and fresh.
How Should I Store Leftovers?
Keep leftovers in an airtight container in the refrigerator for up to 3 days. Reheat on the stove over low heat, stirring frequently to prevent sticking or burning.
What Can I Substitute for Bacon?
You can use turkey bacon or even smoked sausage for a different flavor. For a vegetarian version, skip the bacon and add a dash of smoked paprika for a smoky taste.



