I got this recipe from vibhandaka over at the Zombie Pumpkins forums. We made a batch Halloween weekend and they turned out delicious.
Caramel Popcorn Balls
5 tablespoons vegetable oil
2 1/2 cups un-popped popcorn OR
3 bags of Natural Microwave Popcorn
1/4 cup butter
1 cup packed light brown sugar
1/2 cup light corn syrup
2/3 cup sweetened condensed milk
1/2 teaspoon vanilla extract
1) Add 1 tablespoon of the oil to a 4 quart saucepan, and heat over high heat. When oil is hot, add 1/2 cup of popping corn. Keep pan moving constantly. When corn stops popping, remove pan from heat. Place popped corn in oven safe container in the oven to keep warm. Repeat until all corn has been popped. Set aside. OR Microwave your popcorn, place in oven to keep warm.
2) In a medium saucepan with a candy thermometer inserted, combine butter, sugar, and corn syrup. Stir well and bring to boiling over medium heat. Stir in condensed milk; simmer, stirring constantly, until thermometer reads 238 degrees F (114 degrees C). Stir in vanilla.
3) Pour caramel over popped corn and stir to coat. Butter hands lightly; shape popcorn into balls about 3 1/2 inches in diameter. Work quickly but be careful because it is very hot at first.