Gather all your ingredients on a clean workspace.
In a medium saucepan, combine the cubed Velveeta cheese and milk over low heat.
Stir continuously until the cheese is melted and smooth.
Add the shredded cheddar cheese and mix until fully incorporated.
Pour in the can of diced tomatoes with green chilies, stirring to combine.
Season the mixture with garlic powder and onion powder.
If desired, add the diced jalapeño for extra heat.
Cook on low for an additional 5 minutes, stirring occasionally.
Remove from heat and transfer the dip to a serving bowl.
Garnish with fresh cilantro and serve with tortilla chips.