Preheat and prep: Heat the oven to 400°F (200°C). Lightly grease a 9x13-inch baking dish.
Soften the cream cheese so it mixes easily.
Slice the chicken and veggies: Cut chicken into thin strips. Slice peppers and onion into similar-size strips for even cooking.
Mix the seasoning: Combine all fajita spices in a small bowl. Taste and adjust salt or heat as needed.
Season the chicken: Toss chicken with half the seasoning and 1 tablespoon oil.
Set aside for 5–10 minutes while you prep the sauce.
Make the creamy fajita sauce: In a mixing bowl, whisk together softened cream cheese, heavy cream, lime juice, remaining seasoning, and a pinch of salt until smooth.
Build the casserole: Spread the seasoned chicken evenly in the baking dish. Top with peppers, onion, and jalapeño if using. Pour the creamy sauce over everything and gently toss to coat.
Smooth into an even layer.
Add cheese: Sprinkle shredded cheese evenly over the top.
Bake: Bake uncovered for 20–25 minutes, or until the chicken is cooked through (165°F/74°C) and the cheese is melted and bubbling. If you like a deeper golden top, broil for 1–2 minutes at the end.
Rest and garnish: Let the casserole rest 5 minutes so the sauce thickens slightly. Sprinkle with chopped cilantro and a little extra lime if you like.
Serve: Spoon into bowls.
Great with a dollop of sour cream, sliced avocado, or a side of cauliflower rice for a heartier plate.