Line a 9-inch square baking dish with parchment paper to prevent sticking.

In a medium saucepan, combine shredded coconut, sugar, condensed milk, butter, and vanilla extract. Stir well to mix all ingredients evenly.

Place the saucepan over medium heat and cook, stirring constantly, until the mixture thickens and pulls away from the sides of the pan, about 15-20 minutes.

Pour the hot mixture into the prepared baking dish and use a spatula to flatten the top for even cooling.

Let cool at room temperature for about 30 minutes until firm.

Lift the parchment paper from the dish and place it on a cutting board. Cut into small squares using a sharp knife.

Serve immediately or store in an airtight container for later enjoyment.