Beat butter and 1 1/4 cups sugar until fluffy. Add yogurt, egg whites, lemon peel and vanilla; mix until well blended. Gradually add combined remaining ingredients except powdered sugar; mix well. Cover and refrigerate for 1-3 hours.

With lightly floured hands, shape dough into 1 inch balls; place on prepared cookie sheet. Using bottom of glass dipped in sugar, press into 1/8 inch thick circles. Bake 10-12 minutes or until edges are lightly browned. Cool 2 minutes on cookie sheet; remove to wire rack. Sift powdered sugar over warm cookies. Cool completely. Store tightly covered. Makes about 4 dozen cookies.