Prepare the spaghetti according to package directions; drain.
Brown the ground beef in a large skillet or Dutch oven over medium-high heat. Drain any excess grease. Add the chopped onion (and green bell pepper, if using) and cook until softened.
Stir in the kidney beans, tomato sauce, diced tomatoes with green chilies, chili powder, Worcestershire sauce, cumin, garlic powder, salt, and pepper. Bring to a simmer and cook for 10-15 minutes, stirring occasionally.
Stir in the cooked spaghetti and half of the shredded cheddar cheese. Transfer the mixture to a greased 9×13 inch baking dish. Top with the remaining cheddar cheese.
Bake in a preheated oven at 375°F (190°C) for 15-20 minutes, or until the cheese is melted and bubbly.
