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Cook bacon in a large skillet over medium heat until crisp. Using a slotted spoon, remove bacon and drain on paper towels, reserving 1 tablespoon drippings in the pan. Add shallots and garlic to the reserved drippings. Cook and stir until garlic is fragrant and just starting to brown. Remove from heat and set aside.
Meanwhile, grease a 10-inch ovenproof skillet or 2-quart square baking dish; set aside. Spread one side of the bread slices with butter. Cut bread into 1-inch cubes. Place half of the bread cubes in the prepared skillet or dish. Sprinkle with half of the bacon. Top with the remaining bread cubes and the remaining bacon. Spoon shallot mixture over the layers; sprinkle with cheese (pan will be full).
In a medium bowl, whisk together eggs, cream (or milk), mustard, salt and pepper. Gradually pour egg mixture over layers in skillet; cover and refrigerate overnight.
Preheat oven to 325°F. Bake casserole, uncovered, for 45 to 50 minutes or until center is set (170°F).