Butter a 9×13-inch glass baking dish. Set aside. Combine milk chocolate, chocolate chips, butter, and marshmallow in a large mixing bowl. Set aside.

In a large saucepan, combine sugar and evaporated milk. Bring to a rolling boil over medium heat. Stir constantly at a rolling boil for 4 minutes with a wooden spoon. Remove from heat and stir in vanilla.

Pour the evaporated milk mixture over the chocolate mixture in several intervals, stirring constantly to keep the fudge from clumping.

Continue stirring until well blended and smooth.

Pour into prepared baking dish. Cover tightly and refrigerate for several hours or overnight, until hardened. Keep refrigerated until you serve.