In a saucepan, over medium-low heat, combine the chocolate chips and sweetened condensed milk. Stir constantly until the chocolate chips are completely melted and the mixture is smooth. Do not let it bubble. Remove from heat and stir in vanilla.
Let cool slightly before glazing cake. It hardens fairly quickly, so work fast if you want toppings like nuts or coconut, etc. to stick.
*Note: You can make ahead and refrigerate if you like, and pop it in the microwave to reheat. Enjoy!!