In a medium saucepan, mix together sugar and milk over medium heat. Bring to a gentle boil, stirring constantly for about 2-3 minutes, until sugar dissolves completely.
Remove the saucepan from the heat, then quickly add in the peanut butter and vanilla. Stir until the mixture is smooth and all ingredients are well combined, about 1 to 2 minutes.
Line a 8x8 inch baking dish with parchment paper, allowing some overhang for easy removal.
Pour the warm mixture into the lined dish.
Use a spatula to spread the mixture evenly across the dish.
Refrigerate for 3-4 hours or until set and firm to the touch.
Once firm, lift out of the dish using the parchment paper edges.
Cut into squares.