White chocolate, despite its name, is not technically a chocolate at all. That's because it doesn't contain any cocoa solids. It's made from cocoa butter (which gives it the white color), milk, and sugar, and may contain other sweeteners and flavorings like vanilla. The combination creates a rich, sweet ingredient with a smooth and creamy mouthfeel. Because of its white color, it produces unique looking confections, including peppermint bark, layered chocolate mousse, and cookies and cream fudge.
Depending on the recipe, it will call for either white chocolate baking squares or white chocolate chips, and these two ingredients can be swapped out for each other. If you don't have any form of white chocolate, you can replace it with milk chocolate; just keep in mind the appearance will be quite different and the flavor slightly off compared to the original recipe.
White Chocolate Swap
If the recipe calls for white chocolate chips and all you have are white chocolate baking squares, or vice versa, just swap in an equal amount. This will keep the color and flavor of your recipe the same.
Chocolate chips, however, often have stabilizers added to make them resistant to melting, so they won't melt as easily and smoothly as baking chocolate. Chocolate chips tend to be kind of thick and clumpy when melted, which may not matter if you're baking something like brownies, but could be an issue when making candy or a chocolate sauce where the chocolate needs to melt down to a thin, smooth consistency. Before proceeding with the recipe, look at the white chips ingredient list; if vegetable oil is listed, the chips will be resistant to melting. Cheap brands of chocolate usually have more filler ingredients and therefore do not melt as well.
Milk Chocolate Swap
If you don't have any white chocolate in your pantry, you can replace the white chocolate called for in your recipe with an equal amount of milk chocolate. This will change the color and look of your recipe, obviously, but will give you the closest flavor match. Like white chocolate, milk chocolate is made from cocoa butter, milk, and sugar. It just has the additional ingredient of cocoa solids, which gives it the brown color. However, if the light-colored appearance of the recipe is important to the final product, milk chocolate will not be the right choice. Sub in milk chocolate for recipes like bread pudding, muffins, and cookies where the white chocolate is not the starring ingredient.
When substituting chips for squares, or vice versa, the equivalent measurement needs to be calculated. The ideal way to do this is with a kitchen scale. Weigh the chips, squares, or milk chocolate in ounces to match the amount called for in the recipe. If you don't own a kitchen scale, follow this guide: 1 1/4 cups of chocolate chips are roughly the equivalent of an 8-ounce bar of baking chocolate.