Heat a large cast iron skillet over medium-high heat. Add the cheese and milk, stirring frequently, until the mixture is smooth and creamy, about 4 minutes.

Stir in the chili, lime juice, chili powder, paprika, cumin, salt, and cayenne. Cook, stirring occasionally, until fully heated and well combined, about 5 minutes.

Serve warm with tortilla chips and salsa on the side. Enjoy!