I am attempting to grow the best pepper plants I can indoors (grow box) so I started with jalapeno peppers. They grow relatively small 2-3 feet and require 2-3 gallon container for growing. While this is fine for an outdoor garden, though indoors I can only sacrifice 1 gallon container. This summer I grew several jalapeno plants which spent half of their life in the grow box and spent our warm summer outdoors. All of the plants produced but there was definitely a clear winner which had incredible early yields even with its small growing quarters.
I used several immature peppers (green) for salsa this year but allowed several peppers to mature (red) which I will be saving the seeds for planting this winter and next summer for future plants. By hand selecting the best parent plants should be good old natural selection at work.
The process to collect pepper seeds is pretty simple though I must first provide this warning:
WARNING: Peppers are hot, especially the veins. When handling peppers use caution and wash your hands well with dish soap. Under no conditions do not rub your eyes or pick rub your nose before washing your hands or you will be regretting it for a couple hours. Using gloves is also recommended.
That being said slice the peppers lengthwise with a sharp knife.
Use a fork or spoon to gently dislodge the seeds into a small bowl.
If you are lucky enough to have hot sunny weather still (week of rain here) lay they out in the sun for a couple days and store them in a cool dry place until you are ready to plant them. If you are sun challenged like me set them on a windowsill for a few days.
As I have said before saving you own seeds is very easy and free and as an added bonus you can personally pick the best plant to be the donors of seeds for your future plantings. In my case I also have the benefit of a plants that is genetically grown to following my sporadic watering and care patterns.