Heat oil in large nonstick skillet over medium heat until hot. Add onion; cook 4 to 6 minutes or until tender..
Stir in diced tomatoes, tomato sauce, brown sugar, Italian seasoning, garlic powder and salt. Bring to a boil. Cover; simmer for 2 minutes.
Add tortellini and bell pepper; simmer 12 to 18 minutes, or until tortellini are tender, stirring occasionally.