01 - Line an 8-inch square baking pan with parchment paper, allowing overhang on opposite sides for easy removal later.
02 - Combine chocolate chips, sweetened condensed milk, and 2 tbsp butter in a medium saucepan over low heat. Stir continuously until completely smooth and melted. Remove from heat.
03 - Stir 1 tsp vanilla extract into the melted chocolate mixture until fully incorporated.
04 - Pour half of the chocolate mixture into the lined pan. Spread evenly with a spatula. Refrigerate for 10-15 minutes until slightly set.
05 - While first layer chills, combine peanut butter, powdered sugar, melted butter, and ½ tsp vanilla extract in a medium bowl. Mix until smooth and creamy.
06 - Spread the peanut butter mixture evenly over the chilled chocolate layer.
07 - Pour remaining chocolate mixture over the peanut butter layer. Spread evenly to cover completely.
08 - Refrigerate for at least 2 hours until completely firm and set throughout.
09 - Lift fudge from pan using parchment paper overhang. Cut into 24 even squares. Serve immediately or store refrigerated.