Preheat your oven to 350°F (175°C). Lightly grease a 9x13 inch baking dish.
In a large mixing bowl, combine the thawed shredded hash browns, condensed cream of chicken soup, sour cream, melted butter, chopped onion (if using), salt, and pepper. Mix well until everything is evenly coated.
Stir in 1 cup of the shredded cheddar cheese and all of the Monterey Jack cheese. Reserve the remaining 1 cup of cheddar cheese for the topping.
Pour the mixture into the prepared baking dish and spread it out evenly.
Sprinkle the reserved 1 cup of cheddar cheese evenly over the top of the casserole.
Bake for 45-55 minutes, or until the casserole is bubbly and the cheese on top is golden brown and melted. If you prefer a crispier topping, you can broil it for the last 1-2 minutes, watching carefully to prevent burning.
Let the casserole rest for about 5-10 minutes before serving to allow it to set slightly.