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Heat a medium saucepan over medium heat and add the olive oil.
Sauté the diced onions for 3–5 minutes until softened, then add the minced garlic and dried basil. Cook for about 30 seconds until fragrant.
Pour in the crushed tomatoes, stir to combine, and bring to a simmer.
Reduce the heat to medium-low and simmer for 15 minutes, stirring occasionally while you make the meatballs. (If the sauce begins to spurt, reduce the heat to low).
Add salt and sugar and adjust seasonings if necessary.