In a skillet over medium-high heat, cook 1 lb ground sausage with 1 teaspoon salt and 1 teaspoon ground pepper and break apart as it cooks, 3-5 minutes until thoroughly browned and no pink is left.(If you're using fresh green chiles, prep, chop, and add them here to cook. )
Add in ⅓ cup all purpose flour and cook for another minute so soak up all of the juices from the sausage.
Slowly pour in 3 cups whole milk and stir. Heat to a low boil and simmer for another 2-3 minutes, stirring occasionally until thickened (gravy will thicken further as it cools).
Add in as much green chile as your heart desires, we usually add in about ½ cup medium heat chiles.