In a large pot of salted water, cook pasta to desired doneness. Drain and set aside.
In a large pot or dutch oven, cook the bacon. When done, remove cooked bacon pieces and set aside. Discard bacon grease, reserving no more than a tablespoon in the pot. Add sliced jalapeno to remaining bacon grease with bacon. Cook over medium heat until tender and fragrant, about 5 minutes.
Add butter to mixture and allow to melt. Reduce heat to low and add milk and cheeses. Stir until melted. As soon as the cheese has melted and a sauce has formed, remove mixture from heat and stir in pasta. Enjoy!