Combine chocolate chips, peanut butter and butter in 1-quart microwavable bowl. Microwave on high for 1 to 1 1/2 minutes or until smooth (stir after 1 minute). Stir in vanilla. Pour chocolate mixture over cereal and stir until all pieces are evenly coated.

Pour cereal mixture into large container (with seal) with powdered sugar. Seal securely. Shake until all pieces are well coated. Spread on wax paper to cool. Store in an airtight container.

Makes 9 cups.