1Heat oven to 350. Spray 11x7 inch (2 quart) baking dish with nonstick cooking spray.
2In medium bowl, combine potatoes. 1 1/2 cups of the cheese, the sour cream, Italian seasoning, peppered seasoned salt and soup; mix well. Spread in sprayed dish. Cover tightly with foil. Bake for 30 minutes.
3Remove from oven. Uncover; arrange meatballs in rows over potatoes, pressing in slightly. Sprinkle with remaining 1/2 cup cheese.
Return to oven and bake uncovered an additional 20-25 minutes or until golden brown and hot in center.