Cook the sausage in a large skillet over medium-high heat, stirring until the sausage is crumbly and lightly browned. Drain off the grease and place the sausage in a bowl. Meanwhile, bring the water to a boil in a large saucepan over high heat. Stir in the grits, and reduce heat to medium-low. Cook and stir constantly for 5 minutes until the grits are tender, or follow package directions.
Stir together the sausage, cheese, butter, hot pepper sauce, and eggs. Fold in the grits until combined, then spread into an ungreased, small casserole dish. Bake in the preheated oven until golden brown on top, 30 to 40 minutes.