Line a rimmed baking sheet with parchment paper or a baking mat and set it aside. In a shallow dish, add the granulated sugar and set it aside.
In a medium nonstick saucepan over medium heat, combine water, milk, unsalted butter, sugar, and salt. Cover and bring to a boil.
Stir in the flour and mix vigorously with a wooden spoon until it forms a smooth dough and starts to pull away from the pan, about 2 to 5 minutes.
Transfer the dough in a bowl of a standing electric mixer with the dough hook attached and knead until smooth.* (You must work fast and don't let the dough get cool). Next, transfer the dough to a churro maker or a large pastry bag fitted with a ½ inch wide star tip or a similar device for preparing churros.
Pipe the batter into 5-6 inches lengths about 2 inches apart on the prepared baking sheet. (The warmer the dough, the easier it to manipulate when squeezing/pipping the dough)
When the oil reaches 350° F, gently drop a few strips of dough in the hot oil and fry until golden brown and crisp. Once cooked, remove them from the oil and immediately place them in the sugar bowl; roll each fried pastry dough to coat with the sugar fully.
Repeat frying 3 to 4 strips of dough a time. (about 4 to 5 minutes) * Make sure you keep turning the churro so it can cook evenly.
With a skewer, carve a hole through the center of each churro. Warm the Dulce de leche in a microwave-safe bowl. Then, place the dulce de leche in a piping bag fitted with a small, narrow tip. Pipe the filling into the churros starting from the center until it comes out the end, then flip the churros around and repeat for the other end, so it is filled. Buen provecho!
Enjoy!