1-Preheat oven: Preheat oven to 350°F and grease your baking dish.

2-Sauté onions and butter: Sauté ¼ cup butter and ½ cup diced onion in a pan over medium heat for 7-8 minutes until they’re soft and translucent. This step builds flavor and starts the base. Next, add the 2 pounds of sliced yellow squash and cook for 10-12 minutes until soft, stirring often to avoid browning.

3-Drain mixture: After cooking, drain the mixture thoroughly using a colander lined with a towel, pressing out extra moisture for at least 5 minutes. This prevents a watery casserole, as mentioned in the tips.

4-Mix seasonings and dairy: Then, combine the drained squash and onion with ½ teaspoon garlic powder, ¾ teaspoon salt, ½ teaspoon black pepper, ½ cup sour cream, 1 large beaten egg, 1 cup shredded cheddar cheese, and ¼ cup grated Parmesan cheese in a bowl.

5-Prepare topping: Melt 3 tablespoons of butter and mix it with the remaining ¼ cup grated Parmesan cheese and 1 cup finely crushed butter crackers. Pour the squash mixture into a 1.5-quart baking dish, then top it evenly with the cracker mixture.

6-Bake casserole: Bake at 350°F (175°C) for 25 minutes until the topping turns golden brown.