In a skillet sauté bacon over medium-high heat. After 2 minutes add the diced onion and cook until onion is translucent, about 4 minutes. Remove from pan, set aside to cool and save the bacon fat for another use.
Preheat gas grill or smoker to 225°Add smoker chips per manufacturer's instructions if using. Set up the grill for indirect grilling (See Note 1).
In a large mixing bowl add the ground beef, cooled bacon and onion mixture, pork sausage (casing removed), eggs, salt, chili powder, breadcrumbs and milk. Mix with hands to incorporate thoroughly. Dump onto a lined baking sheet and form into a large loaf in middle of pan with your hands.
Place meatloaf on grill and cover. Cook/smoke for 2 hours or until internal temperature reaches 160°F. Baste with your favorite BBQ sauce 2 times in last 30 minutes.
Remove from grill and allow to rest 10 minutes before slicing. Serve with more BBBQ sauce on side.
Video
Notes
Grill using indirect heat: For gas grill do the 2 Zone set up which is either half the grill is lit to achieve desired temperature and the meat is placed on opposite side, or have sides lit leaving the center NOT on or lowest temperature.