1 1/2 pounds yellow squash
1 pound zucchini
1 small sweet onion, chopped
2 1/2 teaspoons salt, divided
1 cup grated carrots
1 (10 3/4-oz.) can cream of chicken soup
1 (8-oz.) container sour cream
1 (8-oz.) can water chestnuts, drained and chopped
1 (8-oz.) package herb-seasoned stuffing
1/2 cup butter, melted
Preheat oven to 350°. Cut squash and zucchini into 1/4-inch-thick slices; place in a Dutch oven. Add chopped onion, 2 tsp. salt, and water to cover. Bring to a boil over medium-high heat, and cook 5 minutes; drain well.
Stir together 1 cup grated carrots, next 3 ingredients, and remaining 1/2 tsp. salt in a large bowl; fold in squash mixture. Stir together stuffing and 1/2 cup melted butter, and spoon half of stuffing mixture in bottom of a lightly greased 13- x 9-inch baking dish. Spoon squash mixture over stuffing mixture, and top with remaining stuffing mixture.
Bake at 350° for 30 to 35 minutes or until bubbly and golden brown, shielding with aluminum foil after 20 to 25 minutes to prevent excessive browning, if necessary. Let stand 10 minutes before serving.