In a saucepan saute onion and mushrooms in butter or margarine until tender. Stir in flour, poultry seasoning, salt and pepper. Add chicken broth and milk. Cook and stir until thickened.
Stir in chicken and vegetables. Heat until hot and bubbling. Pour chicken mixture into 9-inch square pan. Place refrigerated biscuits on hot mixture and bake in 400 F. oven until biscuits are golden, approximately 15 minutes.