This oven baked 3-ingredient penny saver potato casserole is the kind of dish that quietly shows up at Sunday supper and somehow steals the whole show. My aunt started making it years ago when money was tight but she still wanted something warm, filling, and special on the table. It’s all about thinly sliced potatoes, a simple creamy sauce, and a blanket of cheese that bakes up bubbly and golden. No fancy steps or fussy ingredients—just honest, comforting food that feels like a hug after a long week.
Serve this casserole hot, straight from the oven, with a simple green salad or steamed green beans to balance out the richness. It’s wonderful alongside roasted or pan-seared chicken, meatloaf, or a skillet of pork chops. For a meatless Sunday supper, pair it with a big bowl of mixed vegetables and some crusty bread to mop up the creamy sauce. Leftovers reheat nicely, so I like to tuck a scoop into a lunch container with a handful of cherry tomatoes and some sliced fruit for an easy next-day meal.
Oven Baked 3-Ingredient Penny Saver Potato Casserole
Servings: 6

Ingredients
2 1/2 pounds russet or Yukon Gold potatoes, thinly sliced
2 cups canned cream of mushroom soup (or cream of chicken), undiluted
2 cups shredded cheddar cheese (or your favorite melting cheese)
Cooking spray or a little butter for greasing the dish
Salt and black pepper, to taste (optional but recommended)
Paprika or dried parsley, for garnish (optional)
Directions
Preheat your oven to 375°F (190°C). Lightly grease a 9x13-inch baking dish with cooking spray or a little butter so the potatoes don’t stick.
Wash and peel the potatoes if you like (I usually peel for this casserole). Slice them as thinly and evenly as you can, about 1/8-inch thick. A sharp knife works fine; a mandoline makes it even easier if you have one.
In a medium bowl, stir the canned cream of mushroom soup until smooth. If you like, season it with a little salt and black pepper. Remember the cheese is salty, so go easy at first—you can always add more at the table.
Spread a thin layer of the soup (about 1/3 cup) over the bottom of the prepared baking dish. This helps keep the first layer of potatoes from sticking and gives them flavor right from the start.
Arrange a single, slightly overlapping layer of sliced potatoes over the soup in the bottom of the dish. Don’t worry about making it perfect; just try to cover most of the surface.
Spoon and spread about 1/3 of the remaining soup over the potatoes, then sprinkle with about 1/3 of the shredded cheese. This layering is what gives you that creamy center and golden top.
Repeat the layers two more times: potatoes, soup, cheese, until you’ve used everything. Finish with a nice, even layer of cheese on top so it can bake up bubbly and golden. If you like a little color, sprinkle the top lightly with paprika or dried parsley.
Cover the dish tightly with foil, tenting it slightly so the cheese doesn’t stick to the foil. Place the casserole on the middle rack of the preheated oven and bake covered for 45 minutes. This helps the potatoes soften in the creamy sauce.
After 45 minutes, carefully remove the foil (watch for steam). Continue baking uncovered for another 20–30 minutes, or until the potatoes are very tender when pierced with a knife and the top is deeply golden and bubbly around the edges.
Once baked, remove the casserole from the oven and let it rest for at least 10 minutes before serving. This short rest helps the sauce thicken slightly and keeps the slices from falling apart when you scoop. Serve warm, straight from the dish, making sure everyone gets a bit of that golden crust and the tender potatoes underneath.
Variations & Tips
For picky eaters who don’t love mushrooms, swap the cream of mushroom soup for cream of chicken or cream of celery—same method, just a different flavor. If your family likes things extra cheesy, sprinkle an additional 1/2 cup of cheese just in the middle layer so every scoop feels special. To stretch the casserole for a bigger crowd without spending much more, add one extra potato and just a small handful more cheese; the soup base will still coat everything nicely. You can also use whatever cheese you have on hand—mild cheddar, Colby Jack, or mozzarella all melt beautifully, or combine a couple of ends from different bags to use them up. For a slightly lighter feel, use reduced-fat cream soup and a lighter cheese, and serve with a big salad. If you want to prep ahead, assemble the casserole earlier in the day, cover it, and keep it in the fridge; pull it out while the oven preheats and add 5–10 extra minutes of baking time. Leftovers can be cooled, covered, and refrigerated for up to 3 days, then reheated in the oven or microwave; a splash of milk over the top before reheating helps bring the creaminess back.