Combine cheese and butter in food processor; pulse till well blended.
Add flour, sugar, salt and cayenne; pulse several times until well mixed. Add water; pulse until mixture comes together and forms a dough.
Turn dough out onto a clean surface and knead until smooth. Form into a ball, divide in half and shape each half into a 8 inch log. Wrap each in plastic wrap; refrigerate at least 2 hours or up to 3 days.
Heat oven to 375. Spray 2 baking sheets with nonstick cooking spray. Remove dough logs and slice into 1/4 in disks and place on prepared baking sheets. Prick top of crackers with a toothpick a few times. Bake 12 to 14 minutes or until just golden on the edge.