Ham & Cheddar Scalloped Potato Casserole

If you need a cozy dinner made with simple, inexpensive ingredients, this Ham & Cheddar Scalloped Potato Casserole is such a good one.

Thinly sliced potatoes are layered with diced ham and covered in a homemade cheddar cheese sauce, then baked until the potatoes are tender and everything is hot, creamy, and bubbly.

It’s basically everything I want from a comfort-food dinner without needing a huge grocery list.

This is also a great way to use leftover ham, but you definitely don’t need to wait until after a holiday to make it. A package of diced ham from the grocery store works perfectly and keeps the prep really easy.

Why You’ll Love This Recipe

There are a few reasons this one deserves a spot in the dinner rotation:

• Made with simple ingredients
• Uses inexpensive potatoes to stretch the meal
• Great for leftover ham
• No canned cream soup needed
• Creamy without using heavy cream
• Family-friendly
• Easy to prep in one baking dish
• Makes plenty for dinner and leftovers

And while it feels like a side-dish casserole, adding the ham turns it into a hearty enough meal to serve for dinner.

Ingredients

• 2 lbs russet potatoes, peeled and thinly sliced
• 1 lb diced ham
• 3 tbsp butter
• 3 tbsp all-purpose flour
• 2 cups milk
• 2 cups shredded cheddar cheese, divided
• ½ small yellow onion, finely diced
• 2 cloves garlic, minced
• 1 tsp garlic powder
• ½ tsp onion powder
• ½ tsp paprika
• ½ tsp black pepper
• Salt, to taste

How to Make Ham & Cheddar Scalloped Potato Casserole

1. Prepare the Potatoes

Preheat the oven to 375°F and lightly grease a 9×13-inch baking dish.

Peel 2 pounds of russet potatoes and slice them thinly and as evenly as possible.

Keeping the slices about the same thickness helps everything cook at the same rate.

2. Cook the Onion

Melt 3 tablespoons butter in a saucepan over medium heat.

Add ½ small finely diced yellow onion and cook for about 3–4 minutes, until it begins to soften.

Add 2 cloves minced garlic and cook for another 30 seconds.

3. Make the Cheese Sauce

Sprinkle 3 tablespoons all-purpose flour over the butter and onions.

Stir continuously for about 1 minute.

Slowly pour in 2 cups milk, whisking as you pour to keep the sauce smooth.

Add 1 teaspoon garlic powder, ½ teaspoon onion powder, ½ teaspoon paprika, and ½ teaspoon black pepper.

Continue cooking for about 3–5 minutes, stirring frequently, until the sauce begins to thicken.

4. Add the Cheddar

Reduce the heat to low and add 1½ cups shredded cheddar cheese.

Stir until the cheese has completely melted and the sauce is smooth.

Taste the sauce before adding any salt. Ham and cheddar can both be pretty salty, so you may not need much.

5. Assemble the Casserole

Arrange half of the 2 pounds sliced potatoes in the prepared baking dish.

Scatter half of the 1 pound diced ham over the potatoes and pour half of the cheddar sauce over everything.

Repeat with the remaining potatoes, ham, and cheese sauce.

6. Bake

Cover the baking dish tightly with foil.

Bake at 375°F for 45 minutes.

Remove the foil and sprinkle the remaining ½ cup shredded cheddar cheese over the top.

Return the casserole to the oven uncovered for another 20–25 minutes, or until the potatoes are completely fork-tender and the cheese is melted and bubbly.

7. Let It Rest

Let the casserole sit for about 5–10 minutes before serving.

This gives the cheese sauce a chance to thicken slightly and makes the casserole much easier to serve.

How Thin Should I Slice the Potatoes?

This is probably the biggest thing that can make or break scalloped potatoes.

You want the potatoes fairly thin and, more importantly, evenly sliced.

If some pieces are really thick while others are paper-thin, you’ll end up with some potatoes that are soft while others still have a crunch.

A mandoline makes this really easy, but you can absolutely use a sharp knife.

Before pulling the casserole from the oven, poke a potato in the center with a fork. It should slide through easily.

If the potatoes still feel firm, cover the casserole again and give it another 10–15 minutes.

What Kind of Ham Should I Use?

This recipe is really flexible.

You can use:

• Leftover cooked ham
• Pre-diced packaged ham
• A ham steak that you’ve diced yourself

If you’re specifically using a cook-before-eating ham rather than fully cooked ham, follow the package’s cooking directions before using it in this recipe.

Can I Use a Different Cheese?

Absolutely.

Cheddar gives this casserole that classic ham-and-cheese flavor, but you could use a combination of cheeses if that’s what you already have.

Monterey Jack, Colby Jack, or even a little mozzarella can work.

I wouldn’t go out and buy multiple cheeses specifically for this recipe, though. Plain old shredded cheddar does the job perfectly.

Can I Use Pre-Shredded Cheese?

Yes.

Freshly shredded cheese generally melts a little more smoothly, but this is a budget-friendly weeknight casserole, not a cheese competition. 😂

If the bag of shredded cheddar is easier, use it.

Budget-Friendly Tips

Potatoes are doing a lot of the heavy lifting here.

Instead of needing several pounds of meat, we’re using 1 pound of ham with 2 pounds of potatoes to create a filling casserole that can feed the family.

You can also:

• Buy a small package of diced ham instead of a whole ham
• Use leftover holiday ham
• Use store-brand cheddar
• Buy potatoes by the bag instead of individually
• Use regular milk instead of heavy cream

There’s really no need to make the sauce with heavy cream. The flour, butter, milk, and cheddar make it plenty creamy.

What to Serve with Ham & Cheddar Scalloped Potatoes

Because this casserole already has potatoes, ham, and cheese, I would keep the sides really simple.

Try it with:

• Green beans
• Steamed broccoli
• Peas
• Roasted carrots
• Side salad
• Applesauce
• Fresh fruit

A bag of frozen vegetables on the side is honestly all you need to turn it into a complete weeknight dinner.

Can I Make This Ahead?

You can prepare the cheese sauce and slice the ingredients ahead of time, but I prefer assembling the casserole fairly close to baking so the raw potatoes don’t discolor.

If you want to get a head start, make the cheese sauce ahead and refrigerate it separately.

Then slice the potatoes, assemble, and bake when you’re ready for dinner.

How to Store Leftovers

Store leftover Ham & Cheddar Scalloped Potato Casserole in an airtight container in the refrigerator for 3–4 days.

Reheat individual portions in the microwave or cover and reheat in the oven until hot throughout.