01 - Preheat oven to 400°F. Line a baking tray with parchment paper.
02 - In a large bowl, combine ground beef, egg, breadcrumbs, Parmesan, garlic, grated onion, parsley, salt, and pepper. Mix until evenly incorporated without overworking the meat.
03 - Divide the mixture into 12 equal portions. Flatten each portion in your palm, place a mozzarella cube in the center, and wrap the meat around the cheese. Seal edges firmly to form a tight ball.
04 - Arrange meatballs on the prepared baking tray. Bake for 20 to 25 minutes until deeply browned and cooked through to an internal temperature of 160°F.
05 - While the meatballs bake, melt butter in a medium saucepan over medium heat. Whisk in the flour and cook for 1 minute, stirring constantly to form a smooth roux.
06 - Gradually whisk in the milk, stirring continuously until the mixture thickens and coats the back of a spoon, about 2 to 3 minutes.
07 - Reduce heat to low. Stir in cheddar, pepper jack, smoked paprika, cayenne, hot sauce, and salt. Continue stirring until all cheese is fully melted and the sauce is silky smooth.
08 - Transfer hot meatballs to a serving platter and drizzle generously with spicy cheese sauce. Garnish with chopped fresh parsley. Serve alongside crusty bread or over pasta.