Gather all ingredients.

Bring a large pot of salted water to a boil. Cook potatoes in boiling water until tender, 8 to 10 minutes. Refrigerate potatoes for 8 hours to overnight.

Preheat the oven to 350 degrees F (175 degrees C). Grease a 9x13-inch casserole dish.

Grate cooked potatoes into a large bowl. Combine melted butter, onion, parsley, salt, and pepper in a small bowl. In a separate small bowl, mix sour cream and milk.

Layer 1/2 of the potatoes into the bottom of the prepared casserole dish. Sprinkle with 1/2 of the butter and onion mixture. Pour 1/2 of the sour cream mixture over the top; cover with 1/2 cup shredded cheese. Repeat with remaining ingredients.

Bake casserole in the preheated oven until cheese on top is lightly browned, about 1 hour.