All ingredients should be gathered.
In a heavy-bottomed large saucepan, simmer mushrooms, broth and onion for 10 to 15 minutes, or until the vegetables are tender.
Transfer the hot mixture into a food processor or blender. Cover the lid with a potholder and pulse until it is creamy, but with some vegetable chunks.
Melt butter in a saucepan. Mix in the flour. Add salt and pepper. Whisk in the half-and-half mixture and mushroom mixture slowly.
Bring the soup to a rolling boil, and continue cooking, stirring continuously, until it thickens.
Stir in the sherry. Season with salt and pepper to taste.