From each cheese slice, cut 2 (1 1/2-inch) rounds; reserve cheese scraps.
In 10-inch nonstick skillet, cook beef over medium-high heat 5 to 7 minutes, stirring occasionally, until beef is thoroughly cooked; drain. Stir in taco seasoning mix, water and potatoes. Cook 3 to 5 minutes, stirring frequently, until hot. Stir in reserved cheese scraps until melted.
Spoon beef mixture evenly into 4 (10-oz) ungreased custard cups. Top each with 2 cheese rounds to look like eyes of owl. Place olive slice on each cheese round to look like pupils of eyes. Add carrots to look like beak and ears; sprinkle lettuce to look like feathers on face.