Preheat the oven to 350 degrees F (175 degrees C). Gather all ingredients.

Melt butter in a skillet over medium heat and cook onion and garlic until onion is soft and translucent, about 5 minutes. Remove from heat and season with salt and pepper.

Combine onion and garlic mixture, beef, crumbled bread, crushed crackers, egg, sour cream, Worcestershire sauce, and 1/2 can tomato sauce in a large bowl. Mix until well combined. Gradually stir in milk, 1 teaspoon at a time, until mixture is moist but not soggy.

Transfer the mixture to a 5x9-inch loaf pan. Bake uncovered in the preheated oven for 40 minutes. Increase oven temperature to 400 degrees F (200 degrees C) for the next step.

Continue baking 15 minutes, to an internal temperature of 160 degrees F (70 degrees C).

Mix the remaining tomato sauce and ketchup in a small bowl. Pour over the top of the meatloaf, and continue baking for 10 minutes.