Cook pasta according to directions on package and cool.
Cook diced butternut squash in boiling water until tender, 8-10 minutes, drain and set aside.
In a blender, combine milk, nutritional yeast, nutmeg, and 1 cup of the cooked butternut squash. Blend until smooth, add 1/2 cup parmesan cheese and 1/2 cup cheddar. Blend again and pour over cooled macaroni.
Add remaining butternut squash pieces and mix into the pasta/cheese mixture. Transfer to an ovenproof casserole dish and bake for 15 minutes.
Top with remaining 3 Tbsp cheddar cheese and bake another 5 minutes.
Remove from oven, let rest 10 minutes – serve hot.