Prep the pan and oven. Preheat the oven to 350°F (175°C).
Grease a 10- to 12-cup Bundt pan thoroughly with cooking spray and a dusting of flour. Make sure to get into every groove to prevent sticking.
Prep the peaches. If using fresh peaches, peel (optional) and chop them into small cubes. If using canned peaches, drain them well and pat dry.
Too much liquid can weigh down the batter.
Make the cream cheese filling. In a bowl, beat 8 oz cream cheese with 1/3 cup powdered sugar and 1 teaspoon vanilla until smooth. Set aside. The texture should be spreadable but not runny.
Mix the dry ingredients. In a separate bowl, whisk 2 1/2 cups all-purpose flour, 1 1/2 teaspoons baking powder, 1/2 teaspoon baking soda, 1/2 teaspoon salt, and 1/2 teaspoon cinnamon (optional).
This prevents lumps and helps even mixing.
Cream the butter and sugars. In a large bowl, beat 3/4 cup unsalted butter with 1 cup granulated sugar and 1/2 cup brown sugar until light and fluffy, about 2–3 minutes. Proper creaming traps air for a tender crumb.
Add eggs and flavorings. Beat in 3 large eggs, one at a time. Mix in 2 teaspoons vanilla extract and 1 teaspoon lemon zest (optional), scraping down the bowl as needed.
Incorporate sour cream and dry ingredients. Mix in 1 cup sour cream.
Then add the dry ingredients in two additions, mixing on low until just combined. Do not overmix.
Fold in peaches. Gently fold 1 1/2 cups chopped peaches into the batter. If your peaches are very juicy, toss them with 1 tablespoon flour first to help suspend them in the batter.
Layer the batter and filling. Spoon half the batter into the prepared Bundt pan and smooth it out.
Dollop the cream cheese mixture evenly over the batter, keeping it away from the sides of the pan. Top with the remaining batter and smooth the surface.
Bake. Bake for 50–60 minutes, or until a toothpick inserted near the center (but not in the cream cheese layer) comes out clean. The top should be golden and spring back lightly when touched.
Cool properly. Let the cake cool in the pan for 12–15 minutes.
Then invert onto a wire rack and let it cool completely before glazing or slicing. Patience helps the crumb set and prevents breakage.
Glaze (optional). Whisk 1 cup powdered sugar with 1–2 tablespoons milk or cream and 1/2 teaspoon vanilla until smooth and pourable. Drizzle over the cooled cake.
Add a pinch of cinnamon if you like.
Serve. Slice with a serrated knife for clean cuts. Serve plain, with a dusting of powdered sugar, or alongside whipped cream or vanilla ice cream.