Step 1: Preheat and Prepare
Preheat your oven to 375°F (190°C). Lightly grease a 9x13-inch baking dish with butter or nonstick spray.
Step 2: Make the Cream Sauce
In a medium saucepan over medium heat, melt the butter. Whisk in the flour to create a roux, stirring constantly for about 1–2 minutes until smooth and lightly golden (do not brown). Slowly whisk in the milk and cream, stirring until no lumps remain. Add salt, pepper, garlic powder, and nutmeg if using. Simmer for 3–4 minutes until the sauce thickens slightly. Remove from heat.
Step 3: Layer the Potatoes
Spread a thin layer of cream sauce on the bottom of your prepared baking dish. Arrange half of the sliced potatoes in an even layer. Top with half of the onions if using, and pour over half of the cream sauce. If using cheese, sprinkle ½ cup over this layer. Repeat the process with the remaining potatoes, onions, sauce, and cheese (if using).
Step 4: Bake the Dish
Cover the dish tightly with foil and bake for 45 minutes. Then remove the foil and bake uncovered for another 25–30 minutes, or until the top is golden and bubbly and the potatoes are fork-tender.
Step 5: Rest and Serve
Let the scalloped potatoes rest for 10–15 minutes before serving. This allows the sauce to thicken further and the layers to settle. Garnish with chopped parsley or thyme, if desired.