Beat butter and sugar at medium speed with an electric mixer until creamy; add egg, beating just until mixture is blended.
Combine flour, baking powder, salt, cheese, and bacon; add to butter mixture alternately with milk, ending with flour mixture. Spoon into greased muffin pans, filling two-thirds full.
Bake at 375º for 25 minutes. Remove from pans immediately; cool on wire racks.