Lightly grease an 8-inch square baking dish, then line it with parchment paper, leaving overhang on two sides.

In a medium saucepan, combine 1 cup of peanut butter and ½ cup of unsalted butter over medium heat. Stir until mixture reaches a gentle boil (3-5 minutes).

Remove saucepan from heat and add 3 cups of powdered sugar and 1 teaspoon of vanilla extract; stir until fully combined (1-2 minutes).

Pour the fudge mixture into the prepared baking dish and spread it evenly using a spatula.

Allow fudge to cool at room temperature for about 1 hour or refrigerate for faster setting (around 30 minutes).

Once set, lift the fudge out using parchment overhang and cut into 1-inch squares.