Brown beef and onion in oil, stirring to crumble meat. Combine soup and milk in saucepan and cook, stirring, over medium heat until smooth. Then add chiles. Cut torillas in 1 inch squares and make 1 layer in baking dish using half of squares. Spread with layer of half of cooked meat, then with half of soup mixture and half of cheese.
Repeat layers. Bake at 325 for 20-30 minutes.