Prep the chicken: Pat the chicken dry and cut it into small pieces, about 3/4-inch. Toss with half the taco seasoning to coat.
This helps the spices bloom and stick to the meat.
Heat the skillet: Set a large skillet over medium-high heat and add 1 tablespoon of oil. When it shimmers, add the chicken in a single layer. Cook without moving for 2–3 minutes to sear, then stir and cook another 3–4 minutes until nearly cooked through.
Transfer to a plate.
Cook the veggies: Add the remaining 1 tablespoon oil to the skillet. Add the onion and bell peppers with a pinch of salt. Sauté 4–5 minutes until softened and lightly browned.
Add aromatics: Stir in the garlic and the remaining taco seasoning.
Cook 30 seconds until fragrant, being careful not to burn the spices.
Deglaze and simmer: Add the drained diced tomatoes and chicken broth. Scrape up any browned bits from the pan—those add flavor. Return the chicken to the skillet and bring to a gentle simmer for 3–4 minutes, until the chicken is cooked through and the sauce slightly thickens.
Finish with lime: Stir in the lime juice.
Taste and adjust salt, pepper, or heat as needed. If you want it saucier, add a splash more broth.
Add cheese (optional): Sprinkle the cheese over the top, cover the skillet for 1–2 minutes, and let it melt.
Serve your way: Top with cilantro and any extras you like—avocado, sour cream, or jalapeños. Serve in lettuce cups, over a bed of greens, or with cauliflower rice.