Preheat oven to 400°F (200°C) and line a baking sheet with parchment paper.
In a bowl, mix ground chicken, breadcrumbs, Parmesan, egg, garlic, Italian seasoning, salt, pepper, and milk.
Shape mixture into meatballs and place on baking sheet.
Brush lightly with olive oil.
Bake for 18–20 minutes until cooked through.
In a skillet, heat olive oil and sauté onion until soft.
Add garlic and cook for 1 minute.
Stir in crushed tomatoes, sugar, basil, oregano, salt, and pepper. Simmer 15–20 minutes.
Add baked meatballs to sauce and simmer 10 minutes.
Cook spaghetti in salted water until al dente. Drain.
Serve meatballs and sauce over spaghetti.