Brown the sausage and onion in a large nonstick skillet, breaking the sausage up as you go. Once browned, drain off some of the fat.
Chop the cheese block into cubes and add along with the diced tomatoes and green chiles and chopped green chiles, juice and all.
Cook over a low heat until it all starts coming together. Then stir in the diced jalapeno. Serve with chips.