Boil potatoes with skin; cool; then cut into chunks. Dice Velveeta in 1" cubes. Chop onion fine; Fry bacon, reserving the drippings; cool; then crumble. In a shallow casserole or rectangle baking dish, mix potatoes, cubed Velveeta, chopped onions and half of the crumbled bacon. In a small mixing bowl, stir together mayonnaise, mustard and bacon drippings. Stir into potato mixture. Sprinkle remaing bacon crumbled bacon over top.
Bake at 350 degrees for about 30 minutes. Best served warm. Garnish ideas: black olives, chives, crumbled crackers or shredded cheese if desired.