Add the butter to a large cast iron skillet and melt over medium heat.
When the butter is melted, add the onion and green chilis to the pan and cook, stirring occasionally for 3 minutes until the onion begins to soften.
Add the chorizo to the skillet and cook, stirring and crumbling the meat constantly until cooked through, about 6-8 minutes.
Pour the chorizo mixture onto a paper towel lined plate to drain the grease.
Remove the skillet from the heat and add half of the Monterrey Jack and half of the pepper Jack, then add half of the chorizo mixture.
Top with the remaining cheese.
Place the skillet in the preheated oven and bake for 15-20 minutes until hot and bubbly.
Garnish with the remaining chorizo. Serve immediately with your favorite chips and/or warmed tortillas.
NOTE ON CHEESES: I do not recommend substituting the Monterrey Jack. If you want to sub the Pepper Jack, you can use Mozzarella instead for a more mild flavor.NOTE: This recipe can be made in any oven-proof dish, but a large cast iron is best. You can double this recipe in a skillet 10 inches or larger.