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Core and clean cabbage. Chop into 1 1/2" to 2" pieces.
Add diced bacon to a large, heavy-bottomed skillet or Dutch oven. Cook over low to medium heat until bacon has lightly crisped. Remove bacon to a bowl while cooking cabbage and drain off bacon drippings, leaving 3 tablespoons in the skillet or Dutch oven for cooking.
Add diced onion to skillet or Dutch oven with bacon drippings and cook until tender, about 3 minutes. Add chopped cabbage to onions and add water. Cook for about 12-15 minutes until cabbage is tender, stirring occasionally.
Add the bacon back to the cabbage and stir gently to combine. Season with salt and pepper to taste.