Preheat the oven to 350 F. In a large bowl, combine butter with powdered sugar until fluffy. Add in flour and vanilla extract, and mix until it is fully combined.
Roll the cookie dough into balls, and flatten each one slightly. Place one cherry on each piece of dough. Roll the cookie dough into a ball, covering the cherry completely.
Place the cookies onto a large ungreased baking sheet. Bake for 10-12 minutes. Place the powdered sugar into a shallow dish. Roll the baked cookies into the powdered sugar.
