Danish Dream Cake is a super soft, fluffy vanilla cake topped with a caramel coconut mixture and baked until it becomes lightly crispy on top and it’s my latest addiction. It’s super easy to make (the topping comes together in the microwave), and the results are insane- I don’t even like coconut but this is SUCH a lovely cake!

I’ve recently been learning more about Scandinavian desserts and baking, and this cake called out to me the minute I heard of it. My version has a super soft cake made extra fluffy by a little bit of powdered sugar plus lots of buttermilk. Let’s get to it!
How to Make Danish Dream Cake
We’re starting out with the cake here, which uses pretty simple ingredients that I usually have on hand, but it does use buttermilk. This has a big impact on the texture of the cake so don’t skip it! We’re starting out by stirring together the dry ingredients in a bowl- in this case that includes all-purpose flour, salt, baking powder, and baking soda.


In a large bowl, add your softened butter, vegetable oil, granulated sugar and powdered sugar, and beat this mixture together until it’s well combined. Then add in your egg and vanilla extract, and give it another mix up.


Once that is well combined, you can add in about a third of your dry ingredients and mix them until there are no dry pockets of flour remaining. Then stir in about half of the buttermilk until combined.


Repeat this process until all of your buttermilk and dry ingredients have been added- you should have a thick, smooth batter. Spread the batter into your cake pan and then it’s off to the oven until baked through.


While the cake bakes, work on the topping. You want to add your ingredients to a microwave safe bowl- butter, milk, brown sugar, salt, and cinnamon- and then give it about 30 seconds to 1 minute at a time in the microwave, stirring between each cooking interval, until the mixture is bubbling and very hot.


Then stir in your shredded coconut and vanilla extract until combined. You want to make sure you’re using unsweetened shredded coconut here because there’s a lot of sugar in the topping itself! Spread this over your baked cake and return the cake to the oven under the broiler for a few minutes.


You want the mixture to brown and bubble, but you want to keep a close eye on things so it doesn’t burn. That said, if you end up with a couple of small over-toasted bits like me, it’s still going to taste amazing!


Cool the cake before slicing and serving- it’s honestly so good and I think you’ll absolutely love it!

Tips & Tricks for the Perfect Danish Dream Cake
Here are my tips to help along the way!
- You can mix this whole cake by hand and I recommend it- it helps you avoid over-mixing the cake batter.
- Why are we using powdered sugar? The addition of a little powdered sugar creates a really soft, almost velvety texture for this cake!
- Do I have to use buttermilk? Yes, this recipe was developed with buttermilk and I do not recommend skipping it here.
- How do I know when the cake is finished baking? Before adding the topping, you want to bake the cake until it’s cooked through, a toothpick inserted into the center of the cake should come out with just a few crumbs clinging to it!
- Be sure to use unsweetened coconut, which can be a little harder to find in the US but it’s easily available online. My local store had it in the organic section of the baking aisle. You DO NOT want to use sweetened coconut here.
- Watch the cake closely once it’s broiling as it can burn very quickly. If you do get a few over-toasted bits, that’s totally ok though! Still, it should only take a couple of minutes to brown.
- Store the cake in an air-tight container for up to a week and re-toast to serve in a toaster oven or at 350 degrees for a couple of minutes in a regular oven.
- I’m at about 5,000 ft. above sea level and I find that most people who live between about 3,000-7,000 ft. above sea level do not need to make any adjustments to my recipes.
Enjoy!

Danish Dream Cake
Ingredients
For the cake:
- 1/2 cup granulated sugar
- 3 tbs. powdered sugar
- 1/2 cup softened unsalted butter
- 1/4 cup vegetable oil
- 1 egg
- 2 tsp. vanilla extract
- 2 cups all-purpose flour
- 1 tsp. salt
- 1/2 tsp. baking powder
- 1/4 tsp. baking soda
- 1 cup buttermilk
For the topping:
- 1/4 cup unsalted butter
- 1/4 cup milk
- 1/2 cup dark brown sugar
- 1/2 tsp. salt
- 1/4 tsp. ground cinnamon
- 1 cup unsweetened shredded coconut
- 1 tsp. vanilla extract
Instructions
For the cake:
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Preheat your oven to 350 degrees and grease an 8-inch square cake pan. In a large bowl, beat together the sugar, powdered sugar, softened butter, and oil until well combined. Add in the egg and vanilla extract and mix until just combined.
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In a medium bowl, stir together the flour, salt, baking powder, and baking soda. Add about 1/3 of the mixture into the batter, and beat until just combined.
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Then add in about half of the buttermilk, again mixing until just combined. Repeat this process until all of the buttermilk and dry ingredients have been added. You should have a fairly thick, smooth batter.
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Spread evenly into your prepared cake pan, and bake for 30-32 minutes, or until a toothpick inserted into the center comes out with just a few crumbs clinging to it.
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Remove the cake from the oven and turn on your broiler.
For the topping:
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In a medium microwave safe bowl, add your butter, milk, dark brown sugar, salt, and cinnamon. Heat in the microwave for 1 minute and then stir the mixture. Heat again in the microwave for another 1-2 minutes, or until the mixture is bubbling and very hot.
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Carefully stir in the shredded coconut and the vanilla extract until combined.
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Gently spread the mixture over the top of the still-hot cake until it’s in a fairly even layer over the top of the cake.
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Bake under the broiler for 3-5 minutes, or until the top is lightly browned all over. Keep a close eye on the cake at this stage- the broiler can cook the top very quickly!
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Cool the cake completely before slicing and serving. Enjoy!

Hello and welcome! My name is Nicole, and Dough-eyed is a food blog for people who want to bake for their family and friends in high-altitude areas. Think of me as a friendly voice there with you in the kitchen, here to give you confidence when you’re baking, and to help you with the struggles of baking at high-altitude. Come back every week for new recipes, tips, and advice on high-altitude baking!

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