Set your oven to 350°F now. Allow it to heat up fully before baking. A preheated oven ensures even, consistent cooking throughout.

Slice the yellow squash into rounds. Place them in a large pot. Cover with salted water and bring to a boil. Cook for 5 to 7 minutes until tender.

Pour the cooked squash into a colander. Let it drain for several minutes. Press gently to remove excess water. This step prevents a watery casserole.

Melt butter in a skillet over medium heat. Add the chopped onion to the pan. Cook for 3 to 4 minutes until soft. Remove from heat and set aside.

In a large bowl, combine the drained squash and cooked onion. Add sour cream, cream of chicken soup, eggs, and cheddar cheese. Season with salt and pepper. Stir everything until well mixed.

Grease your 9x13 baking dish lightly with butter. Pour the squash mixture into the dish. Spread it out evenly with a spoon.

Crush the Ritz crackers into coarse crumbs. Mix them with a little melted butter. Sprinkle the crumbs evenly over the top of the casserole.

Place the dish in the preheated oven. Bake for 35 to 40 minutes. The top should be golden and the filling set. Let it rest for 5 minutes before serving.