In a medium heavy-bottomed saucepan set over medium heat, melt the butter. Once melted and foaming, add the flour and whisk constantly for 1 to 2 minutes until the mixture is pale golden and smells slightly toasty. Do not let it brown.

Add dairy

Slowly whisk in the whole milk and half-and-half in a steady stream to prevent lumps. Continue whisking until the mixture is smooth and begins to thicken, about 3 to 5 minutes over medium heat.

Add cream cheese

Reduce heat to medium-low. Add the cubed cream cheese and whisk until fully incorporated and smooth, about 2 minutes.

Melt the cheeses

Gradually add the shredded cheddar and monterey jack in small handfuls, stirring or whisking until each addition is melted and the sauce is smooth before adding more. Keep the heat low so the cheese melts gently and does not separate.

Season and add mix-ins

Stir in the drained diced tomatoes with chiles, finely chopped pickled jalapeños, ground cumin, smoked paprika, garlic powder, kosher salt, black pepper, and hot sauce if using. Taste and adjust seasoning—add more pickled jalapeños or hot sauce for heat, or a pinch more salt if needed.

Keep warm

Lower the heat to the lowest setting and keep the queso warm, stirring occasionally. If the sauce becomes too thick, thin with 1 to 2 tablespoons of milk at a time until desired consistency is reached.

Garnish & Serving

Arrange the tortilla chips on a large platter or in a shallow bowl near the warm queso. Transfer the queso to a warmed serving bowl or small slow cooker set to low for party service.

Top the queso with a few additional pickled jalapeño slices and a sprinkle of chopped fresh cilantro for brightness.

Serve immediately with lime wedges on the side. Encourage guests to squeeze lime over chips before dipping for a fresh lift. If the queso cools and thickens, rewarm gently over low heat and stir in a splash of milk to restore creaminess.