Preheat oven to 325°F. Slice yellow squash, four large or 6 small to about 1/8-inch. Melt 2 Tbsp. butter in frying pan. Add squash. Cook about 8 minutes stirring occasionally. Remove to large mixing bowl. Add 1 Tbsp. of butter, melt and then add onions, and bell peppers. Cook for two minutes, add to bowl.
Add rest of ingredients (except remaining butter and 16 crackers) into a 2.5 quart casserole dish sprayed with Pam or Crisco. Melt remaining butter and mix with 16 crackers. Spread on top of casserole.
Bake for 45 minutes covered loosely with a sheet of foil. Take off foil and bake an additional 10 minutes.