Heat oven to 375 degrees F.
Place 2 cups onion in a bowl.
Place shredded cheeses, cream cheese, mayonnaise, thyme and remaining 1 cup onion in bowl of food processor. Process until fairly smooth. Mix with onion in bowl. Spoon into shallow 6-cup baking dish.
Bake at 375 degrees F for 20 minutes. Stir. Bake 10 more minutes. Cool slightly. Serve with crackers or toast. Makes 16 servings.