Heat butter in a medium saucepan over low heat until fully melted and slightly foamy.

Add chopped onion and cook until soft and translucent for sweet and mild flavor base.

Stir in minced garlic and cook for one minute until fragrant but not browned.

Pour in diced tomatoes with green chilies. Stir and let flavors mix gently together.

Slowly add milk or cream. Stir continuously to create a smooth and creamy base.

Add shredded cheddar and Monterey Jack cheese gradually while stirring on low heat.

Keep stirring until all cheese melts completely into a smooth and thick mixture.

Mix in salt, pepper, cumin and chili powder. Stir well for balanced flavor.

Add a little more milk if queso is too thick. Stir until perfect dipping consistency.

Let queso cook on low heat for a few minutes. Stir occasionally to avoid sticking.

Taste carefully and adjust seasoning if needed. Add more spice or salt if desired.

Pour into a serving bowl. Garnish with cilantro and serve immediately with tortilla chips.