Preheat your oven to 350 degrees Fahrenheit. Lightly grease a 2-quart baking dish with butter or a non-stick cooking spray to ensure the casserole serves easily. Make sure your frozen spinach is thoroughly thawed and squeezed in a clean kitchen towel to remove as much liquid as possible, which prevents the dish from becoming watery.
In a large skillet over medium heat, melt the 1/2 cup of butter. Add the finely diced onions and cook them until they are soft and translucent, which usually takes about 5 to 7 minutes. This step creates a flavorful base that carries through the entire casserole.
Lower the heat and add the cubed cream cheese to the skillet with the onions. Stir constantly until the cheese has melted and combined with the butter. Gradually whisk in the milk, salt, and pepper until the mixture is smooth and slightly thickened. This rich sauce is what makes the dish so iconic for Christmas dinner.
Fold the prepared spinach into the cream cheese mixture. Stir well to ensure every bit of spinach is coated in the creamy sauce. Once everything is well incorporated, pour the mixture into your prepared baking dish and spread it out into an even layer.
In a small bowl, toss the crushed crackers with the 2 tablespoons of melted butter. Sprinkle the buttery crumbs evenly over the top of the spinach mixture. Place the dish in the oven and bake for 25 to 30 minutes, or until the edges are bubbling and the cracker topping is a beautiful golden brown.
