Cook the bacon in a deep skillet over medium heat until crisp, 5-7 minutes. Remove bacon from skillet and drain on a paper towel-lined plate. Reserve about ¼ cup drippings in the skillet.
Add diced onions to the reserved hot bacon drippings in the pan. Cook over medium heat. Once onions are translucent, add the cabbage and cook for about 3 minutes. Add brown sugar and balsamic vinegar to the pan and sauté until cabbage is softened and starting to brown, about 5 minutes.
Crumble bacon over cabbage and continue cooking until bacon is warmed, another 2-3 minutes. Season with salt and black pepper. Serve warm.