Preheat your oven to 325°F (160°C).
In a saucepan, melt 1/4 cup sugar over medium heat until it turns golden brown.
Quickly pour the caramel into four ramekins, coating the bottoms.
In a separate bowl, whisk together milk, heavy cream, and sugar until fully combined.
Add eggs one at a time, whisking until smooth.
Stir in vanilla extract.
Pour the mixture into the caramel-coated ramekins.
Place ramekins in a baking dish and fill with hot water halfway up the sides.
Bake for 45 minutes or until set.
Let cool, then refrigerate for at least 2 hours before serving.