In a large skillet, heat olive oil over medium heat. Add the sliced bell peppers and onions, sautéing until they become tender.
Stir in the shredded chicken, chili powder, cumin, garlic powder, salt, and pepper. Cook for an additional 2-3 minutes until all the flavors are well combined.
Grease a baking dish and layer two tortillas on the bottom. Spread half of the chicken and vegetable mixture over the tortillas, then sprinkle with one-third of the shredded cheese. Repeat the layers and top with the remaining tortillas and cheese.
Bake the casserole for 20-25 minutes or until the cheese is bubbly and slightly golden.
Serve the sizzling chicken fajita bake hot, optionally garnished with sour cream, diced tomatoes, and fresh cilantro.