In a saucepan over low heat melt the butter and chocolate chips.
Once melted add the evaporated milk and powdered sugar. Mix well until smooth.
Turn the heat to medium high and bring to a boil. Stir constantly. Once at a boil, reduce heat to medium low and boil slowly for 8 minutes, stirring constantly.
Remove from the heat and add the vanilla. Stir well and cool.
Can be served warm over ice cream or kept in the refrigerator for later use.