Preheat the oven to 425°F (220°C). Line two baking trays with parchment paper to prevent sticking.

In a medium saucepan, combine the milk, butter, water, salt, and sugar. Stir gently over low heat until the butter is fully melted and the mixture is smooth.

Increase the heat to medium and bring the mixture to a steady simmer. Remove immediately from the heat and add the flour in one addition.

Using a wooden spoon, stir vigorously until the dough is smooth and thick. A light film will form at the bottom of the pan—do not scrape it. Continue stirring until well combined.

Transfer the dough to a food processor or mixing bowl. Allow it to cool slightly for 1–2 minutes. Add the eggs one at a time while mixing continuously. The dough should be glossy and smooth. You may not need the fourth egg.

Stir in the Cheddar and Gruyere cheeses until evenly incorporated.

Using a small cookie scoop, place spoonfuls of dough onto the prepared trays, spacing them about one inch apart.

Place the trays in the oven and immediately reduce the temperature to 375°F (190°C). Bake for 20–25 minutes, or until the puffs are golden brown and firm.

Remove from the oven and allow to cool slightly before serving. Serve warm.