Preheat the oven to 350°F (175°C).
In a mixing bowl, beat the softened cream cheese, sour cream, and fajita seasoning until smooth and uniform.
Fold in the finely diced bell pepper, finely diced sweet onion, and shredded chicken until evenly combined.
Spread the mixture into a 2-quart casserole dish in an even layer.
Top the dip evenly with the shredded Cheddar or Mexi-blend cheese.
Cover loosely with foil and bake at 350°F for 25–35 minutes, until the edges bubble; optionally remove the foil for the last 10 minutes to brown the cheese.
Sprinkle chopped cilantro over the hot dip and serve warm with tortilla chips or sliced veggies for dipping.