Start by preparing the dough. In a microwave-safe bowl, melt butter carefully. Ensure it cools to room temperature; this step is crucial to avoid cooking the yeast.
Next, warm milk in the microwave until just warm (not hot). Test the temperature by dropping a few drops on your wrist; it should feel comfortable. Combine the melted butter and warmed milk in a bowl and set aside.
In a large bowl, mix together flour, sugar, baking powder, yeast, and salt. Whisk these dry ingredients thoroughly to ensure they're evenly combined.
Slowly add the milk mixture to the dry ingredients. Use a wooden spoon to stir until a shaggy, sticky dough forms. Don’t worry if it seems messy; this is normal!
Lightly flour your hands and gently knead the dough a few times until it forms a rough ball. Be careful not to overwork it, as this can make the fry bread tough.
Drizzle vegetable oil into the bowl and turn the dough to coat it lightly. Cover the bowl with a damp kitchen towel and let it rest while you prepare the filling.
In a large pan over high heat, add olive oil. Once it shimmers, add the ground beef. Let it sear without stirring for a couple of minutes, then crumble it with a wooden spoon until fully browned.
Reduce the heat to medium and add the taco seasoning and minced garlic. Stir for about a minute until fragrant, then pour in the picante sauce and scrape the bottom of the pan to release any flavorful bits. Add the chili beans (do not drain) and cook until warmed through.
While the filling simmers, prepare for frying the dough. In a large cast-iron pot, heat 1 inch of oil to 350°F. Portion the rested dough into 8 equal pieces.
With floured hands, work each piece into a rough circle, about 5 to 6 inches wide, keeping it rustic. Do not use a rolling pin. The thinner, the better—they cook up crispy!
Carefully drop one piece of dough at a time into the hot oil. Fry until golden brown, about 30 seconds to 1 minute per side, flipping with two forks.
Once golden and crispy, use a slotted spoon to transfer the fry bread to a paper-towel-lined plate. Repeat with remaining dough.
To serve, top each piece of fry bread with a generous portion of the meat filling and your chosen toppings like lettuce, tomatoes, or guacamole. Enjoy your homemade Navajo Tacos immediately for the best experience!