In a medium skillet, cook ground beef and onions over medium high heat until beef is thoroughly cooked. Drain off the fat. Stir in taco seasoning mix and water; simmer 10 minutes.
In medium bowl, combine refried beans and taco sauce.
In an ungreased 8 inch square (2 quart) baking dish, layer ½ the bean mixture, ½ the beef mixture, 2 cups tortilla chips and 1 cup of the cheese. Top with remaining bean mixture and beef mixture.
Bake for 25 minutes. Remove from oven. Top with remaining tortilla chips and cheese. Return to oven; bake an additional 3 to 5 minutes or until cheese is melted. Serve with lettuce and tomatoes.