German Potato Salad

2 lbs. red skinned potatoes, unpeeled
6 slices bacon cut into 1" pieces
1/2 cup finely chopped onion
1/3 cup vinegar
1/3 cup water
1 teaspoon sugar
1/2 teaspoon pepper

Cook potatoes in boiling water to cover 15 minutes or until tender. Drain; cool. Cut potatoes into slices and place in a bowl; set aside. Cook bacon in a skillet until crisp; remove bacon, reserving 1/2 cup drippings in skillet. Crumble bacon; set aside to drain on paper towels. Saute' onion in drippings until tender. Stir in vinegar, water, sugar, and pepper. Cook 1 minute; add bacon, and cook until heated. Pour over potatoes, toss gently. Yield 6 servings

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