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

Place potatoes in a large pan; fill with enough water to cover and bring to a boil. Cook until potatoes are just soft. Drain and place in a large bowl.

Gently stir processed cheese into hot potatoes without mashing them. Continue to stir every minute or so until cheese is melted.

Stir together mayonnaise, bacon, and onion in a separate bowl. Gently stir into potato-cheese mixture until well combined. Spread into a 9x13-inch baking dish.

Bake in the preheated oven for 50 minutes.