Caramelized Onion and Bacon Dip

This Caramelized Onion & Bacon Dip is rich, creamy and oh so delicious! Serve it warm or cold, with bread or chips for an appetizer everyone will love! Need more appetizer ideas? Check out my Hot Spinach Dip and Buffalo Chicken Pastry Bites!

Caramelized Onion and Bacon Dip ready on wood board to serve with crostini

Caramelized Onion and Bacon Dip

This creamy and delicious Caramelized Onion & Bacon Dip is a simple appetizer that can be made in advance for easy entertaining. 

Spread this dip on toasted baguette slices and add fresh tomato & basil for a pretty garnish, or simply add the dip to a bowl and serve with potato chips or pita chips. 


This recipe was created in partnership with Challenge Dairy.

top down view of dip on white bowl on board

Something magical happens when you slowly cook down onions until they’re caramelized. 

The flavor is sweet and rich and complex… without any of the pungent notes of raw onion.  If you’ve never made caramelized onions, then you’re in for a really special treat!  

Caramelized Onion and Bacon Dip sitting on cutting board with cream cheese and butter in packages in the bacground

This recipe includes a pretty simple list of ingredients.  The beautiful caramelized onions are blended with fresh Challenge Cream Cheese, sour cream, freshly cooked bacon bits and then just some salt and pepper and a bit of balsamic to add one more subtle layer of flavor.

I know when I use Challenge brand dairy products I can depend on consistent quality and fresh taste. Challenge butter has been churned fresh daily since 1911, so they’ve truly mastered dairy!  

Challenge loves to let their fresh, high quality ingredients shine through in their products and this means I can depend on a pure taste and superior results!  

If you’re not sure where you can find Challenge butter and cream cheese near you, use this helpful map.


onion dip served on crostini garnished with tomato and basil

There are lots of delicious ways to enjoy this dip!  

  • For a more formal presentation, toast baguette slices and spread with the dip, then top with fresh tomato, fresh basil, or a few extra bacon bits would be great too!  
  • For more casual serving, simply add the dip to a bowl and serve with sliced baguette, wavy potato chips or pita chips.  Feel free to dip fresh veggies in the dip as well!  
  • Additionally, this dip would be delicious in place of mayo on a hamburger bun, or in a sandwich wrap (try with fresh lettuce, tomato and grilled chicken).

More Tasty Recipes To Try

  1. Hot Spinach Dip
  2. Buffalo Chicken Pastry Bites
  3. Salsa Cream Cheese Chicken Wraps
  4. Chicken Salad Sandwiches

How To Make Caramelized Onion and Bacon Dip

Caramelized Onion and Bacon Dip

Rich, creamy & delicious! Can be served warm or cold. Delicious with bread, potato chips or pita chips.
Prep Time 20 mins
Cook Time 15 mins
Total Time 35 mins
Course Appetizer
Cuisine American
Servings 16
Calories 76 kcal


Caramelized Onion

  • 1 large yellow onion
  • 2 tablespoons Challenge butter salted
  • 1 tablespoon oil such as light olive oil
  • 1/4 teaspoon salt

Creamy Dip

  • 3 slices bacon cooked and chopped
  • 8 ounces Challenge cream cheese, 1 block, at room temperature
  • 1/2 cup sour cream
  • 1 teaspoon balsamic vinegar
  • 1/4 teaspoon salt in addition to salt listed with onions
  • 1/4 teaspoon black pepper


  • Slice onion into thick rings (or half rings), and separate into idividual pieces.  Place onion slices into a large saute pan, along with 2 tablespoons butter and 1 tablespoon oil. 
  • Cook on medium high heat, stirring as needed. After 10 minutes, reduce heat to low and continue cooking, stirring only as needed.  You want the onions to develop a nice brown color, but do not allow them to burn.  If needed, add just a bit of water to the pan if the pan is dry. The onions are fully caramelized when they have cooked down and are dark brown.  The process generally takes about 30 minutes total. Remove from heat and allow to fully cool.  When cooled, chop into small pieces.
  • While the onions are cooking, cook 3 slices of bacon (in the oven, microwave or another saute pan).  Cool, then chop into small pieces and set aside.
  • In a large bowl, beat cream cheese (with an electric hand mixer, or stand mixer) until fully smooth.
  • Add sour cream and blend.  Add chopped caramelized onion and blend.  Add bacon, balsamic, salt and pepper and blend until all ingredients are well incorporated.
  • Spread dip onto plain or toasted baguette slices, or serve with thick potato chips or pita chips.  The dip may be enjoyed warm or cold.



Calories: 76kcalCarbohydrates: 2gProtein: 1gFat: 7gSaturated Fat: 4gCholesterol: 20mgSodium: 127mgPotassium: 42mgFiber: 1gSugar: 1gVitamin A: 235IUVitamin C: 1mgCalcium: 26mgIron: 1mg
Keyword caramelized onion bacon dip
Tried this recipe?Let us know how it was!

Disclosure – I created this recipe as part of an ongoing partnership with Challenge Dairy.  Partnering with brands I love allows me to provide you high quality content at no cost to you.  I only work with brands I use and love.  All images, text and opinions are my own.

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