Begin by peeling and thinly slicing the red onion.

In a medium saucepan, combine white vinegar, water, sugar, salt, peppercorns, and mustard seeds.

Heat over medium until the sugar and salt dissolve completely.

If using, add bay leaf to the pickling liquid.

Once the liquid is hot, remove from heat and pour it over the sliced onions in a glass jar.

Allow the jar to cool to room temperature.

Seal the jar with a lid and place it in the refrigerator.

The onions will be ready to enjoy in about an hour.

Store in the refrigerator for up to two weeks.