The Indian bitter gourd, referred to as karela is another variety of the [Momordica charantia] bitter melon. This variety is smaller than many of the other varieties and has a very prickly exterior and it is prone to be more bitter than other bitter melons.
The bitter taste comes from the gourd's quinine content.
The brighter green the melon is the better it is. Pass over gourds that are turning yellow or orange. These are too old to use and become tough. (See uses below).
When the little bright green gourds are young you can just slice them thin and add them raw to salads or a spicy curry (which mellows the bitterness). If you want to use up and older, yellowing gourd then slice it lengthwise and scrape out the seeds with a spoon.
The bitter gourd slices may also be deep fried and served as chips.
People in different regions use the gourds in different ways. For example the Punjabis stuff the gourds with mashed potatoes then fry them. The Bengalis add them to vegetable soups and stews.
The gourds are sometimes even pickled with garlic and tamarind. (Source: Linda Bladholm, The Indian Store Demystified).