Step 1: In a food processor, combine the grated sharp cheddar cheese, all-purpose flour, and salt. Pulse several times until the cheese is finely chopped and well distributed throughout the flour mixture.
Step 2: Add the cold, cubed unsalted butter to the food processor. Pulse until the mixture resembles coarse crumbs, with some pea-sized pieces of butter remaining. Don’t overmix.
Step 3: With the food processor running, slowly add the ice water, one tablespoon at a time, until the dough just comes together into a ball. You might not need all the water; the dough should be firm but pliable, not sticky.
Step 4: Turn the dough out onto a lightly floured surface. Briefly knead it a few times to bring it fully together. Divide the dough in half, flatten each half into a disc, wrap tightly in plastic wrap, and refrigerate for at least 30 minutes.
Step 5: Preheat your oven to 375°F (190°C). Line two baking sheets with parchment paper.
Step 6: On a lightly floured surface, roll out one disc of dough very thinly, about 1/16 inch thick. Aim for an even thickness across the entire sheet of dough.
Step 7: Using a fluted pastry wheel or a sharp knife, cut the dough into 1-inch squares. Use a skewer or toothpick to poke a small hole in the center of each square. Repeat with the second disc of dough.
Step 8: Carefully transfer the cut squares to the prepared baking sheets, leaving a small space between each cracker. Any scraps can be gently re-rolled once or twice.
Step 9: Bake for 12-18 minutes, or until the crackers are golden brown and crisp. Keep a close eye on them, as baking times can vary between ovens. Rotate the baking sheets halfway through if needed.
Step 10: Once baked, remove the crackers from the oven and immediately transfer them to a wire rack to cool completely. They will crisp up further as they cool. Store cooled crackers in an airtight container at room temperature for up to one week.