In a large skillet, melt the butter over medium-low heat then add the onions, salt and sugar.
Saute for 15 minutes.
Slowly add water, scraping any bits from the bottom of the pan; allow the water to evaporate.
Cook for 15 minutes longer or until onions turn a golden brown color and are soft.
Remove onions from the skillet, reserving 1/4 cup.
Place cream cheese, sour cream, Worcestershire sauce and onions in a food processor.
Pulse several times until everything is combined.
Spoon dip into serving bowl and top with reserved caramelized onions and chopped chives.
Notes
Don't rush the onions: If you try to rush the caramelization process for the onions you may end up with burned onions. It's best to go low and slow.
Make it ahead of time: This onion dip gets even better the longer it sits. I recommend making it a day in advance.
Avoid the smell: If the smell of onions cooking is too intense, you can always cook them outside on the grill. Just remember to keep the heat low and keep an eye on them.