Heat a large pot of salted water, 4 quarts of water, 1 Tbsp salt. Blanch the halved Brussels sprouts for 3 to 4 minutes, until just barely tender. Use a collander to drain and then rinse with cold water to stop the cooking, and set them aside.

Place diced bacon in a large skillet on medium low heat. Cook until most of the fat is rendered, about 8 to 10 minutes. Remove the bacon from the pan and set aside, leaving the rendered fat in the pan.

Add butter to the pan and melt on medium heat. Add the shallots and gently cook until softened, about 4 to 5 minutes. Add the flour to the butter shallot mixture to make a roux, whisk for 1 to 2 minutes. Add the milk and stir with a wooden spoon until the roux is incorporated into the milk. Cook over medium low heat for several minutes, stirring, until the sauce thickens and coats the back of your spoon. Add in the thyme and sprinkle with nutmeg.

Add 3 ounces of the grated Gruyere cheese into the white sauce and stir until the cheese is melted and incorporated into the sauce. Add half of the cooked bacon back to the sauce. Taste and add more salt if necessary.

Preheat oven to 400°F. Butter, or spray with non-stick cooking spray, an 8×12 gratin dish or casserole .

Add the Brussels sprouts into the cheese sauce. Transfer the cheesy Brussels sprouts into the casserole or gratin dish. Sprinkle with the remaining bacon and the remaining 1 ounce of grated Gruyere cheese.

Bake for 25 minutes until top is lightly browned and bubbly. Remove from oven and let sit for 10 minutes before serving.