In a medium-size saucepan, melt butter or margarine. Mix in flour and 1 teaspoon of salt. Stir continually until the mixture is simmering.
Slowly pour milk into the mixture. Continue stirring over a medium heat until the mixture has thickened. Stir in cheese and mustard. Continue stirring until all of the cheese is melted and the dip is smooth. Serve warm after adding salt and pepper to taste.