Preheat oven to 400° F
Butter a medium casserole dish.
Layer half of the Potatoes into the 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 saucepan, melt Butter over medium heat.
Mix in the Flour and Salt and stir constantly with a whisk for one minute.
Stir in the Milk. Cook until mixture has thickened.
Stir in Cheese all at once, and continue stirring until melted, about 30-60 seconds.
Pour Cheese over the Potatoes, and cover the dish with aluminum foil.
Bake 1 1/2 hours in preheated