- Preheat oven to 200ºC. Butter a casserole dish.
- Layer 1/2 of the potatoes into bottom of the prepared casserole dish. Top with the onion slices, and add the remaining potatoes. Season with salt and pepper to taste.
- In a medium-size saucepan, melt butter over medium heat. Mix in the flour and salt, and stir constantly with a whisk for one minute. Stir in milk. Cook until mixture has thickened. Stir in cheese all at once, and continue stirring until melted, about 30 to 60 seconds. Pour mixture over the potatoes, and cover the dish with aluminum foil.
- Bake for 1 1/4 hours. Then remove foil, top with a little more grated cheddar cheese and bake for another 15mins uncovered until cheese is golden and the potatoes are soft.