Preheat the oven to 350 degrees F (175 degrees C). Spray a casserole dish with cooking spray.
Heat a large skillet over medium-high heat. Cook and stir sausage in the hot skillet until browned and crumbly, 5 to 7 minutes. Drain and discard grease. Place sausage in the bottom of the prepared dish.
Saute potatoes, onion, and green bell pepper in the same skillet until tender, about 6 minutes. Place mixture over the sausage. Sprinkle 1 cup Cheddar cheese on top.
Beat eggs and milk together in a bowl and pour into the casserole dish. Add the rest of the Cheddar cheese on top.
Bake in the preheated oven until cheese is melted and slightly browned, 15 to 20 minutes.