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In a 2 quart bowl, combine sugar and milk.
Add butter or margarine. Cook, uncovered, on high for 5 minutes until mixture comes to a full rolling boil, stirring twice.
Reduce setting to medium and cook 6 minutes, stirring twice.
Stir in chips until melted. Add marshmallow crème, vanilla, and nuts and stir until well combined.
Pour into a buttered 9x9 inch baking pan.
Cool. Cut into squares.