We observed shape recovery of a deformed droplet in an immiscible polymer matrix under large step strains using stereo microscopes from two directions. On application of a large step strain, a soft spherical droplet in a matrix with higher viscosity deformed to a flat ellipsoid. The stretch ratio of major axis of the flat ellipsoid was 5/4 times larger than that predicted from the affine deformation. The flat ellipsoid changed into a rod-like shape and then to a dumbbell, to an ellipsoid of revolution, and finally back to the sphere. The orientation angle between the major axis and shear direction did not change during the course of this shape recovery and was independent of the initial radius of the droplet. The time needed for the whole shape recovery got longer as the initial radius and the strain were increased. For a given step strain, the normalized interfacial area plotted against the stretch ratio fell onto a master curve irrespective of the initial radius of the undeformed droplet. It is shown that the deformed droplet reforms to the sphere after it passes through various shapes by reducing the interfacial area.