Pan de Muerto is a traditional sweet bread served on Dia de los Muertos, or the Mexican Day of the Dead celebration.
In a large bowl of a mixer, thoroughly mix 1 cup of the flour, plus the sugar, salt, and yeast. Set aside.
In a saucepan (or in a microwave-proof bowl), combine the milk, water, and margarine. Head until the liquid is warm and the margarine begins to melt. The mixture should not be hot.
Add the milk mixture to the dry ingredients and beat two minutes at medium speed of the mixer. Add the eggs and orange zest, plus another 1/4 cup of flour. Beat again. Then stir in enough additional flour (approximately 1 1/4 additional cups) to make a soft dough. Knead the dough until it is smooth and elastic. Place the dough in a greased bowl, cover, and let rise in a warm place until doubled in bulk (about one hour).
Punch down the dough and fold it over several times. Cut off approximately 1/4 of the dough and set that portion aside. Take the remaining large portion of dough and shape it into a large ball. Place the large ball of dough on a greased baking sheet and set it aside.
Divide the smaller piece of dough into three sections - two long pieces of rope, and one small ball. Pinch the pieces of rope to form knobby "bones." Then drape the two ropes across the large ball of dough so that they cross each other. Finally, place the small ball in the center on the top. Cover again and let rise until double in bulk, about one hour.
Place the risen bread into an oven heated to 350 degrees. Bake for 20-25 minutes or until golden brown.
For the topping: Melt the butter and brush it over the top of the bread. Sprinkle the sugar generously over the bread until it is covered.