Paneer is an acid cum heat coagulated milk product and is widely consumed in the northern part of India. When food safety officers collect the paneer sample for analysis, formalin is added to keep it fit for longer duration for chemical analysis. In India, 0.4% formalin is a legally permitted preservative. However, scientific reports suggest that it is not able to preserve paneer samples for long duration. At 0.4% concentration all microorganisms are not killed and consequently the spoilage of paneer is not prevented. Therefore, in the present study various physicochemical properties of 0.4% formalin-preserved paneer (formalin added by spraying method) were determined during its storage at room temperature. It was found that % acidity, water soluble nitrogen, tyrosine value, OPA content, FFA, peroxide value, conjugated diene and total carbonyl content of paneer increased significantly after one month of storage at 37 o C. Based on the results obtained, it may be concluded that in the paneer samples which are preserved with 0.4% formalin (added by spraying method), changes in chemical characteristics of paneer were observed just after 1 st month of storage and after 2 nd month of storage there was excess gas production and very foul smell due to growth of microorganisms.