Preheat the oven to 350 F. In a large bowl, combine softened butter with powdered sugar until fluffy. Add in the vanilla extract, mix until smooth. Add in the flour, and mix until it is fully combined.
Fold in the sprinkles. Roll the cookie dough into balls, and place them 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.