Step 1: Soak the mushrooms in the hot water until softened (20 minutes); drain, reserving soaking liquid. Squeeze mushrooms dry and then chop the mushrooms.
Step 2: In a bowl combine the two cheeses along with the cornstarch.
Step 3: In the fondue pot (can also use a saucepan) combine 1 cup of the reserved soaking liquid, white wine and garlic and bring to a simmer and let simmer for 2 minutes; discard garlic. Adjust heat so that liquid is barely simmering. Stir in cheese (1 handful at a time) and stir until each addition melts before adding the next handful of cheese. After all the cheese has been added, stir until smooth. Stir in mushrooms and 2 teaspoons thyme; season with pepper. ****this can be prepared one day ahead; cool and press plastic onto surface of fondue and refrigerate; cover and refrigerate remaining mushroom liquid. Before continuing, rewarm fondue over low heat, you may need to add additional mushroom liquid if too thick.
Step 4: ***if not using a fondue pot transfer mixture to flameproof 2 quart casserole; sprinkle with thyme leaves. Set over alcohol burner or gas table burner and serve, allowing guests to skewer bread with fork and dip into the cheese fondue.
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