In a large pan set over medium heat, melt 1 tablespoon of butter. Add the diced onion and sauté for 7-8 minutes until soft and translucent.

Add the sliced squash to the pan. Cook for 10-12 minutes, stirring frequently, until the squash becomes soft.

Drain the cooked squash and onions in a colander lined with a towel. Let it sit for at least 5 minutes while pressing out the excess moisture.

In a bowl, mix the drained squash and onion with garlic powder, salt, black pepper, sour cream, beaten egg, shredded cheddar cheese, and ¼ cup grated Parmesan. Stir until thoroughly combined.

Melt the remaining 3 tablespoons of butter. Mix it with the crushed crackers and remaining ¼ cup of Parmesan.

Scrape the squash mixture into a baking dish and evenly sprinkle the cracker mixture on top.

Bake at 350°F for 25 minutes or until the top is golden brown and bubbly. Let it cool for a few minutes before serving.