Slice the potatoes into thin slices, about ⅛-inch thick. Try to keep the slices as even as possible so they cook evenly. Peel the onion, cut it in half vertically, and thinly slice it into half moons. If you prefer, it can be chopped instead.
2 pounds potatoes, ½ medium onion
In a large measuring cup or small bowl, combine broth, cream, salt, pepper, and nutmeg to make the sauce. Set aside.
¾ cup reduced sodium chicken broth, ½ cup heavy cream, ½ teaspoon kosher salt, ¼ teaspoon coarse ground black pepper, pinch freshly grated nutmeg
In a large skillet that has a lid, heat butter over medium heat. Add potatoes and onions and cook, stirring frequently, for 5 minutes.
1 tablespoon unsalted butter
After the potatoes have cooked 5 minutes, add the sauce to the skillet, and increase heat to medium-high. Bring to a boil. Reduce heat to a simmer (medium-low heat), and cover pan. Cook, covered, for 13 to 15 minutes or until potatoes are fork-tender and the sauce has started to thicken.
Sprinkle with cheese, cover the pan, and continue to cook over low heat for 2 to 3 minutes, or until cheese is melted.
1 ¼ cups shredded sharp cheddar cheese
Take the pan off the heat, and let potatoes cool for 5 to 10 minutes before serving. The sauce will continue to thicken as the potatoes cool.
If desired, top with fresh chives before serving.
Video
Notes
Potato choices: You can use russet or other thicker-skinned potatoes. I peel those before slicing them. Red or Yukon gold (yellow) potatoes are tender-skinned so you can simply scrub them and leave them unpeeled.
Cheese variations: If desired, omit cheese, or use a different kind of cheese, such as Gruyère, Swiss, fontina, Asiago, or whatever you like best.
Pro tip: If you prefer, broil the potatoes under high heat for 2 to 3 minutes or until golden brown on top. Be sure to use an oven-safe or cast iron skillet if you plan on broiling the potatoes.
Storage: Store leftover scalloped potatoes in the fridge for up to 4 days. They do not freeze well. Reheat gently in the microwave (50% power) or on the stove. Try not to overheat them which may cause the sauce to separate.