Preheat the oven to 375℉ (190℃). Generously butter a 2-quart casserole dish with butter.
Wash and peel potatoes, then thinly slice the potatoes into ⅛-inch thin slices. Arrange the sliced potatoes in an even layer in the buttered casserole dish.
Melt 2 tablespoons unsalted butter over medium-low heat in a heavy-bottomed medium saucepan. Once the butter has melted, add 2 tablespoons minced shallot and sauté for about 3 minutes or until the shallots begin to soften, being careful to not burn your shallots.
Add 2 tablespoons all-purpose flour to the saucepan whisking well to form a thick paste. Allow to cook for 1 minute, to remove the raw flour taste from the sauce.
Slowly whisk ½ cup broth into the flour mixture until incorporated. Once creamy, whik in ¾ cup half and half. Season with 1 teaspoon kosher salt, ¼ teaspoon black pepper, ¼ teaspoon grated nutmeg, and 2 teaspoons fresh thyme leaves. Allow the sauce to simmer, whisking constantly, over medium-low heat until it coats the back of a spoon and slowly drips off the spoon. ~3-5 minutes
Remove the cream sauce from the heat and pour it over the prepared potatoes in the casserole dish. Lightly push the potatoes into the sauce so that they are fully submerged.
Cover with foil and bake for 45 minutes. After 45 minutes, remove the foil, and bake for an additional 25-30 minutes, or until potatoes are tender and the top is lightly browned.
Let the scalloped potatoes rest for 10-15 minutes and then serve warm.
Video
Notes
Potatoes: You can use either russet or Yukon gold potatoes. It is not necessary to peel the potatoes when using Yukon Gold Potatoes, but is recommended for russet potatoes.Half and Half: Feel free to use whole milk or cream in place of half and half. Do NOT use low fat or skim milk.Nutmeg: Use a whole nutmeg bulb grated with a Microplane, not ground nutmeg. If you don't have whole nutmeg, just omit it from the recipe. Gluten-Free Scalloped Potatoes: use a gluten-free 1:1 flour blend.Doubling the Recipe: Double the ingredients and layer in a deep 9X13 pan. Cover with foil and bake at 375°F for 60 minutes. Remove the foil and bake an additional 20-25 minutes, or until the potatoes are fully tender.Make-Ahead Instructions: Bake as directed. Allow to cool, cover tightly with foil, and refrigerate for up to 3 days. When ready to serve, remove the scalloped potatoes from the refrigerator and let come to room temperature while the oven preheats. Bake covered with foil, at 350°F for about 30 minutes, or until warmed through.Leftovers: Store leftovers in an airtight container for up to 4 days in the refrigerator.