Preheat your oven to 375°F and grease a 9x13 inch casserole dish with cooking spray or butter. Cut the chicken breasts into bite sized strips or cubes. Slice all bell peppers and onion into thin strips. Mince the garlic finely. This prep work makes assembly quick and easy.

Season the cut chicken strips with 1 tablespoon of fajita seasoning, salt, and black pepper. Toss the chicken to coat evenly with the spices. Let the seasoned chicken sit for 5 minutes while you prep the vegetables. This allows the flavors to penetrate the meat.

Heat 2 tablespoons of olive oil in a large skillet over medium high heat. Add the sliced bell peppers and onions to the hot pan. Cook for 5 to 7 minutes, stirring occasionally, until the vegetables start to soften and develop some char. Add minced garlic and ½ tablespoon of fajita seasoning. Cook for 1 more minute until fragrant. Transfer vegetables to a plate.

In the same skillet, add 1 tablespoon more olive oil if the pan is dry. Add the seasoned chicken strips to the hot skillet. Cook for 5 to 6 minutes, stirring occasionally, until the chicken is mostly cooked through and lightly browned on the outside. The chicken will finish cooking in the oven. Remove from heat.

Spread half of the sour cream across the bottom of your greased casserole dish. Add half of the cooked chicken and vegetable mixture as the first layer, spreading it evenly. Sprinkle with 1 cup of shredded cheese. Spoon half of the diced tomatoes or salsa over the cheese. Add a pinch of fajita seasoning.

Add the remaining chicken and vegetable mixture as the second layer. Spread the remaining sour cream over the top. Spoon the rest of the diced tomatoes or salsa evenly across. Sprinkle the remaining fajita seasoning over everything. This layering creates maximum flavor in every bite.

Cover the entire top of the casserole with the remaining 2 cups of shredded cheese, making sure to cover edge to edge. You can also sprinkle crushed tortilla chips on top of the cheese for extra crunch if desired. The generous cheese layer creates that signature golden, bubbly top.

Place the assembled casserole in the preheated 375°F oven. Bake uncovered for 20 to 25 minutes until the cheese is melted, bubbly, and golden brown around the edges. The internal temperature should reach 165°F. The edges will get slightly crispy, which adds amazing texture.

Remove the casserole from the oven and let it rest for 5 minutes before serving. This allows the cheese to set slightly and makes the casserole easier to cut and serve. The resting time also lets the flavors meld together beautifully.

Cut into generous portions and serve hot with your favorite toppings. Fresh cilantro, lime wedges, extra sour cream, guacamole, and salsa all make perfect accompaniments. This chicken fajita casserole is best enjoyed immediately while the cheese is still gooey and the edges are crispy.