This homemade Cheesy Potato Casserole recipe is a lightened up dish for any occasion. A family favorite holiday recipe to bring to the table or a “anytime” side dish that serves a crowd, these cheesy potatoes are a classic.

This easy cheesy potato casserole also goes great with my Healthy Green Bean Casserole and Cranberry Orange Sauce for Thanksgiving!

Cheesy Potato Casserole Recipe with spoon lifting out of casserole dish

CHEESY POTATOES! This is one of my family’s classic thanksgiving side dishes served at just about all of our family gatherings. We’re just making things a little bit lighter and from scratch!

My dad has perfected his version over the years that involves copious amounts of butter, canned soup and lots of cheese. But I wanted to make a homemade version using simple ingredients and everything from scratch, so here we are!

A “Lightened Up” Cheesy Potato Casserole Recipe

Now, I say “lightened up” because in my cheesy potato casserole experience, this version is healthier in comparison to the traditional recipe.

I didn’t go too light on the cheese though… I mean, CHEESE is in the title so I can only do so much here.

But what I did do was come up with a lighter homemade sauce mixture, instead of using canned cream of chicken soup, making this recipe suitable for vegetarians.

Just trust me, you’re gonna love it.

Ingredients List

unsalted butter – this will be used to make the sauce, but also needed for the corn flakes topping.
flour – 1:1 gluten-free all purpose flour may be used as needed, if looking for a dietary friendly recipe.
onion powder, garlic powder & salt – for a little flavor enhancement, plus powdered seasonings are easy peasy.
unsweetened cashew milk or oat milk– you can also use the milk of your choice here. I balanced out all of the cheese with a lightened up dairy free milk option.
Greek yogurt & sour cream – I am using both here because the yogurt can be a little tart. You can also use all sour cream. If using all greek yogurt, use whole milk, full-fat if possible.
packaged diced potatoes – I liked the bigger potatoes versus shredded frozen hash browns style.
shredded cheese – feel free to use a mix here such as sharp cheddar cheese, Monterey Jack, colby, etc.
cubed cheese – This is where I told you I wasn’t really cutting back on the cheese because my family would probably disown me. My dad uses a mix of shredded and cubed, so that’s what I did here. Plus, who doesn’t want an extra glob of cheese the next time your fork finds the plate.
corn flakes cereal for the crunchy topping – Make sure to get gluten-free corn flakes if needed! You can also use potato chips, crushed pretzels or Ritz crackers are another popular option. Corn flakes are my personal favorite though.

cheesy potato casserole recipe ingredients

How to Make Cheesy Potato Casserole from Scratch

Because we’re making a homemade sauce (roux) instead of using a canned soup, this potato casserole recipe requires a little more hands-on time but I promise it’s not difficult at all.

Here’s a step-by-step breakdown of how to make this simple side dish, with the full recipe card at the bottom of the post.

Step 1 – Make the homemade sauce (roux)

In medium saucepan over medium-high heat, add 4 tablespoons butter with flour, onion powder, garlic powder, salt and pepper; whisk continuously until mixture starts to bubble – this will be about 2 minutes. Then slowly add in cashew milk and stir continuously for about 4-5 minutes. Once the mixture has thickened, remove from heat.

Step 2 – Add ingredients to casserole dish

In bottom of greased 9×13 baking dish, add thawed diced potatoes. Then pour over the homemade sauce, add Greek yogurt, sour cream, shredded cheese and cubed cheese. Give the mixture a good stir using a large spoon or sturdy spatula.

You can also mix everything in a large bowl, then transfer to baking dish.

Bake uncovered for another 15 minutes until top has bubbled and edges start to brown. Option to switch oven to “broil” for last 3 minutes to brown top even more.

Step 3 – Bake for 45 minutes

You’ll first bake the cheesy potatoes uncovered for 45 minutes. During the last 5 minutes of baking, melt the remaining 2 tablespoons of butter and combine with corn flakes cereal.

Step 4 – Add crushed corn flakes

After 45 minutes of baking, place cornflakes on top of cheesy potato mixture. This is also where I’ll add another light sprinkle of more shredded cheese .

Baked Cheesy potato casserole recipe with parsley garnish

Dig in!

Dig into the fresh cheesy goodness and wow your friends and family with this homemade casserole!

This could be your new favorite holiday side dish.

Preparing this recipe ahead of time

To make ahead, simply prepare the cheesy potatoes as written in the recipe (through step 3 in the recipe card below), then cover and place in the fridge overnight.

Then allow the casserole dish to come to room temperature before baking as written. Make sure the oven is fully preheated as well.

Hand pulling spoon out of cheesy potato casserole dish

Serving Suggestions

Cheesy potatoes are a classic midwest side dish to bring to pretty much any holiday, i.e. Easter dinner, Thanksgiving, Christmas and more.

But they are also nicknamed “funeral potatoes” because they serve a crowd.

If you are having a dinner party and you’ve got some cheese lovers attending, you can’t go wrong with a cheesy side dish.

More Healthy Side Dishes

If you’re looking for more healthy side dishes for the holidays, check out this list! Surprise family and friends with these amazing healthier recipes everyone will love.

If you make this cheesy potatoes recipe, be sure to leave a comment and star rating below! I love hearing from you and it helps others learn about the recipe too. Xx Ashley

Cheesy Potato Casserole

A “Lightened Up” Cheesy Potato Casserole Recipe

Ingredients List