In a medium saucepan, over medium heat, combine ½ cup of unsalted butter and 1 cup of brown sugar. Stir continuously until the mixture is melted and smooth, about 3 minutes.

Once the butter and sugar mix is perfectly melted, slowly pour in ¼ cup of milk. Stir carefully for an additional 2 minutes.

Remove the saucepan from heat and let the mixture cool for about 10-15 minutes.

Transfer the cooled caramel into a mixing bowl, then add 2 cups of powdered sugar and 1 teaspoon of vanilla extract. Combine until silky smooth.

Use the frosting immediately on cakes or cupcakes or store it in an airtight container in the fridge.