Prepare Pan: Drizzle olive oil in a large baking dish. Spread diced onion evenly across the bottom.
Season Chicken: Pat chicken thighs dry with paper towels. Season both sides with salt and pepper.
Arrange Chicken: Place chicken thighs skin-side up on top of the onions in the baking dish.
Apply BBQ Sauce: Brush each chicken thigh generously with BBQ sauce, coating the tops and sides.
Bake: Place in the oven and bake for 30 minutes.
Add Cheese: Remove from oven and sprinkle shredded cheese evenly over the chicken thighs. Return to oven and bake for an additional 5-10 minutes until cheese is melted and bubbly and chicken reaches an internal temperature of 165°F.
Rest: Let chicken rest for 5 minutes before serving.